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BPF criticises Tory tax plans
15:52 | 02.07.09
Shadow Conservative chancellor George Osborne’s plans to change tax rules have come under fire from the British Property Federation (BPF).
Osborne has planned to end rules that make companies' interest payments on their debts tax deductible.
He signaled his intention, which he believes would prevent UK firms from becoming dependant on borrowing, in a speech earlier this year.
However, the BPF has warned that debt is an ‘essential’ part of the property sector.
Andrew Teacher, BPF spokesman, said: ‘Debt is an essential part of property development which is a fundamental part of the economy.
‘While we are all aware of the need to reduce debt and increase liquidity, debt will still form a crucial part of the financing for future development.
‘With government capital spending likely to face significant cuts, it is vital that private developers are able to work unimpeded to help regenerate our towns, in partnership with local councils and public bodies.
‘Property has been extensively affected by the credit crunch and undermining the ability of developers to recover by making debt more expensive would be highly detrimental.’
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