Owners of empty and run-down buildings in the capital now face rate charges after Douglas City Council adopted a new policy designed to breathe life back into neglected properties.

The move marks a shift away from the previous system, under which some dilapidated or uninhabitable buildings had received a rates allowance, a practice found to have no legal basis.

Under the new policy, properties will no longer be granted automatic rate relief simply because they are empty or in poor condition. Instead, exemptions will apply only in tightly defined circumstances.

Council Leader Devon Watson said the changes were long overdue. ‘We should be encouraging people to invest in their properties and, first and foremost, make sure people can live in them,’ he said.

‘There are plenty of buildings in our city centre that could be homes, businesses or community facilities but are left to decay instead because no one’s had to pay rates on them.

'That’s not fair on the rest of our ratepayers and it’s not good for Douglas.

'This approach will create an incentive to either renovate the property or sell it to someone who will bring it into use.

‘As a council, we believe this new policy strikes the right balance between fairness for existing ratepayers, improving the overall appearance of the capital and, potentially, unlocking much-needed housing.’

The policy will be formally published on the council’s website in the coming weeks.

But the announcement has sparked debate online about wider barriers to investment.

One commenter wrote: ‘There is a new 2% tax which discourages investment.

'Have a look at the length of time to get a planning application through? Over 12 months, this also discourages investment.

'Look at the amount of vacant space around the island and we have “full employment” red tape has discouraged investment and led many businesses to close there doors or operate elsewhere, 49 gaming companies have left an awful lot of vacant space around Douglas City Centre. If the island wasn’t being strangled by taxation and regulatory burden and a place where businesses thrive there wouldn’t be so much vacancy!'

Onchan MHK Rob Callister has backed the council’s stance and urged other authorities to consider similar measures.

He said: ‘I wholeheartedly applaud the stance being taken by Douglas City Council regarding empty and vacant properties in the capital of the island.

'I sincerely hope Onchan District Commissioners will now follow suit.

'Just last week, I tabled a question to the Treasury Minister asking whether the Isle of Man should adopt legislation similar to that in England, Scotland, and Wales concerning an “Empty Property Premium.”

'This premium allows local authorities to charge additional council tax on properties that have been unoccupied and substantially unfurnished for a defined period.

'The aim is to encourage owners to bring empty homes back into use.

'In the UK, the premium typically begins after one year of vacancy. Councils can charge 200% of the standard rate after one year, 300% after five years and 400% after 10 years’

Mr Watson said he wanted to see the island’s 16 other local authorities following suit.