There are no plans to cut tax relief on mortgages, the Treasury Minister told MHKs.

Alfred Cannan was asked in the House of Keys by Julie Edge (Onchan) whether he would review the policy on mortgage relief for residents.

The current maximum allowable deduction on mortgage and loan interest relief was reduced in the last budget to £5,000 a year, or £10,000 for jointly assessed couples. It is restricted to the lower rate of 10%.

Mr Cannan (pictured) told the Keys: ’As I stated in my budget speech last year, this allowance remains generous and while many of our competitors jurisdictions have, or are looking to removed it, I am at present committed to retaining it.

’Therefore, I can confirm that Treasury does not intend to review this policy.’

Tax relief for mortgage and loan interest paid was capped at £15,000 per individual from April 2008 but that limit has been steadily reduced, to £10,000 in 2010 and £7,500 the following year, and then down to £5,000 last year. In 2012, relief was restricted to the lower tax rate of 10%, alongside relief for all other deductions such as charitable donations, private medical insurance and nursing expenses.

These moves, together with a sustained period of low interest rates, have resulted in the cost of the mortgage tax relief falling from £11.08m in 2007-08 to £3.22m by 2015-16, a reduction of 71%.

The UK abolished MIRAS (Mortgage Interest Relief at Source) in April 2000.

In the Republic of Ireland, no mortgage relief will be available from January 2021. It is also being phased out in the Channel Islands and will be abolished in Guernsey by 2025, and in Jersey by 2026.

Here, Treasury officials say reducing or abolishing tax relief on mortgages could have an adverse impact on the property market in terms of both construction and sales.

And with government intent on increasing the economically active population to boost revenues, potential new residents may see the relief as a ’perk’ which is not offered by other jurisdictions - and that could influence their decision on where to relocate to.