Politicians accused of hypocrisy over property tax

There is certainly a fight for the votes of landlords and tenants across the UK. On one side we have the Labour Party fighting the fight for tenants while on the other side the Conservatives are looking to encourage further investment in property. As we approach the next general election property, investment, landlords and tenant rights will be major subjects going forward. However, there is now even greater focus on the dealings of individual political parties and their MPs.

Tax avoidance is legal but is it moral?

Over the last few days there has been considerable focus on the company “Labour Party Properties Ltd” which consists of 19 buildings across the UK. This is the Labour Party’s property company which is currently valued at around £20 million. Rental income during 2018 hit a record £2.6 million although this was offset by property expenses of £1.7 million and administration costs of £265,000. So we have a net profit of around £630,000 for the company year 2018.

Surprisingly, bearing in mind the Labour Party’s extreme focus on tax avoidance and tax evasion, the company has paid zero tax since 2003. In a perfectly legal manoeuvre the profits from last year were offset against deferred losses.

Property portfolio

Interestingly, more than half of the 19 properties held within the limited company are rented on the open market (we can safely assume at the going market rate?) with the balance leased to local Labour parties. Indeed the administration costs associated with the company for 2018 included an interest charge of £102,000 which was payable to the Labour Party. Again, this is a perfectly legitimate and legal business practice where we can assume that the Labour Party funded the limited company at some point.

The focus is not upon business practice, which are all perfectly legal, legitimate and sensible, but the fact that some of the practices undertaken by the Labour Party’s property company are the ones being criticised by John McDowell. In effect, if some of the practices currently used were removed then there would be a significant impact on Labour Party finances.

Politicians, self-interest and radical policies

While this is just the latest in an array of property-related issues associated with members of Parliament across all parties, it does highlight what is said in public and what actually happens in practice. In reality you would expect the Conservative party to come out on the side of investors and landlords with Labour more protective of tenants. That is what people vote for and that is what people expect.

Whether there is an argument that politicians and political parties should abide by their own policies is a whole different debate. On one hand they need to protect and enhance party funds and party assets (and are also entitled to look after their own interests) but there are concerns of double standards and hypocrisy.


Landlords, tenants and property investors have been the subject of many discussions and new tax policies in recent times. There is no doubt that the potential profit for property investors/landlords has been reduced in the short term and the rights of tenants enhanced. Indeed, whether Boris Johnson is able to form a long-term government or Jeremy Corbyn collects the keys to 10 Downing Street, the property market, taxes and investors will be centrestage for some time to come.

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