We face a long wait until Rachel Reeves’s next budget, but there has already been one worrying hint as to what might be in store.
The cash-strapped government is reported to be looking at coming after “unearned income”; specifically by making landlords pay more tax on their earnings. This may well be one of the many policy ideas we hear in the coming weeks that never amounts to anything, but it’s telling that ministers consider “unearned income” to be fair game.
The chancellor has tied herself in knots by promising not to increase taxes for “working people”, and her party has since struggled to explain exactly its definition of a working person.
I suspect that what they have really meant all along is that they do not want to increase the taxes on your payslip, but would be happy to raise taxes on what you do with your post-tax earnings.
Unlike “working people” perhaps, the definition of “unearned income” seems far more subjective and also potentially wide-ranging. It not only covers money generated by investments, such as dividends or capital gains, but also property price rises and inheritances.
