PROPERTY developer Richard Carr has called for the scrapping of levies on new building which he says are holding back business.

He says the community infrastructure levy (CIL) and Section 106 (S106) contributions – both collected by councils from developers – are no longer viable.

Mr Carr claims the charges are affecting the industry and are a factor in the housing shortage.

He said: “I’m very much for paying taxes and have done all my business life – and I believe property taxes can work and help projects such as social housing and community infrastructure if they are used correctly. However, my problem is that I don’t believe they are.

“CIL is an outdated tax that developers have become disillusioned with. The line between CIL and S106 payments has become faded and clarification is need from government to explain why they are in place.”

S106 agreements allow councils to collect money to mitigate new development, often to provide social housing. CIL funds local infrastructure and can apply to most new development which creates floor space of at least 100sqm.

Borough of Poole is set to raise £1.3million in CIL and S106 payments from a scheme promoted by Mr Carr for Lilliput Road and approved last year.

Mr Carr is a consultant for Fortitudo Property, which put forward the plans to demolish four homes and build 36 luxury flats.

The businessman is also leading plans for a £100m redevelopment of Salterns Marina, creating 73 flats and a 60-bedroom hotel. It would generate £3m in CIL.

Ministers are considering an overhaul of the levies.

Mr Carr added: “I believe they should be abolished for 24 months on condition that the development is started within 12 months from grant; it should only be implemented on greenfield sites that are inherently cheaper to develop.“How can it be correct for a developer to pay £385 planning fees on a 500 square foot flat and the same for an 18,000 square foot house?”

Mr Carr’s own property company Ravine Lifestyle and leisure business Future 300 went into administration in 2008 and he was later made bankrupt, barring him from becoming a company director for 10 years without a court’s permission.