The Welsh Government has opened a consultation on how holiday lets are currently being managed by seeking two key changes to the way the rules are applied, giving the sector greater flexibility.
The proposals would allow holiday let owners to use an average of 182 days let over several years, which would mean that those who narrowly miss 182 days letting in the latest year would remain on non-domestic rates if they had achieved it on average over 2 or 3 previous years, whilst allowing up to 14 days of free holidays donated to charity to count towards the 182-day target.
Mark Drakeford, Cabinet Secretary for Finance and Welsh Language, said: “Tourism makes an important contribution to the Welsh economy and to Welsh life. Wales has so much to offer, and we want to ensure we realise that potential in a way that achieves a balance between our communities, businesses, landscapes and visitors.
“We work closely with tourism and hospitality businesses to help address the challenges they face, while ensuring everyone makes a fair contribution towards local economies and funding public services.
“While most holiday let owners are already meeting the new rules brought in from 2023, with 60% of properties meeting the letting criteria, we have listened to those working in the sector and are proposing small changes to the current rules to support them.”
The consultation also asks whether councils should consider giving businesses more time to adjust, such as a 12-month grace period before they may have to pay higher council tax rates when they move from non-domestic to domestic classification.
The consultation is open until 20 November 2025. You can Respond to the consultation here.
Subject to the outcome of the consultation, the legislation would need to be passed in the Senedd to implement these proposals, with changes intended to take effect on 1 April 2026.
Nicky Williamson, PASC UK Cymru Director, said: “For three years we have continually presented the Welsh Government with data showing the damage caused by this policy - yet they continue to ignore the reality.
“Tourism in Wales has lost over a quarter of its overnight visitors since this policy began, yet the threshold for businesses hasn’t changed, leaving owners punished for something completely outside their control. Business owners are working harder than ever just to stand still, with 85% driven to discount to try to achieve the threshold. The 182 threshold is the problem and this must be reduced significantly.”
Currently the recently introduced legislation properties in Wales need to be made available for at least 252 days, and actually let for 182, compared with properties in England which must be made available for let for at least 140 days, and actually let for 70.
