Chancellor defends tax hike on property owners
John Healey told the BBC he was targeting those with assets after raising a planned increase in landlord tax.
Chancellor John Healey has defended the hike in Income Tax paid by property owners announced in his Budget.
He said he was avoiding a tax increase for workers earning wage income and targeting those with assets.
Speaking on BBC Radio 4’s Today programme, he said: “I am having to ask more from some, but I am protecting income that’s earned through employment.
“My priority has been to try and protect earned income through employment and dividend income which is often part of business investment.”
Further 2%
Landlords will have to pay a further 2% in Income Tax on their rental earnings from April, under the Budget provisions, with the basic level of tax on rent raised to 24%.
Healey’s predecessor Rachel Reeves had planned to increase the rate to 22% from 20%.
The higher rate will go up from 40% to 44%, and the additional rate from 45% to 49%.
The Treasury said 84% of income tax payers would be unaffected by the changes.
Landlord exits
Philip Boyden, MD at Essex and Suffolk agency Boydens, says: “The Budget disproportionately squeezes private landlords while offering narrow, restricted interventions for prospective homebuyers.
“The introduction of another 2% tax increase on property income, confirms an ongoing pattern of targeting the private rental sector.
“The additional tax burdens, combined with the escalating regulatory environment with the introduction of the Renters’ Rights Act, will inevitably push rental prices higher and force landlord exits.”
