A cross-party think tank has urged Chancellor Rachel Reeves to implement a package of eight tax reforms designed to raise $\text{£}21$ billion, with several key proposals focused squarely on the UK property sector and high-net-worth individuals.

The recommendations, first reported in The Times, include major structural changes to how rental income and inherited assets are taxed, as well as new levies on the wealthiest property owners and investors.

Direct Hits on Landlords and Rental Income

The proposals suggest introducing a measure that would significantly increase the tax burden on Buy-to-Let (BTL) investors:

• National Insurance on Rental Income: The think tank advocates for subjecting landlords’ rental income to National Insurance (NI) contributions. This would effectively align rental profits with earned income, representing a substantial new cost for every private landlord in the country.

Taxes on Wealthy Property and Expatriates

Two other major proposals target wealth held in high-value property and investor gains:

• Tax Increase on $\text{£}2$ Million+ Homes: The proposals call for increased taxes on homes valued at more than $\text{£}2$ million. While the specific mechanism (e.g., higher Council Tax bands, a mansion tax, or changes to Stamp Duty) was not detailed, the intent is clearly to draw revenue from the highest end of the housing market.
• “Exit Tax” on Departing Investors: A radical “exit tax” is proposed for wealthy investors who relocate outside the UK. This levy would force them to pay tax on the profits made while they lived in the country, aiming to capture capital gains before assets are moved offshore.

Restructuring Capital Gains and Inheritance

A final, far-reaching proposal relates to Capital Gains Tax (CGT) on inherited assets, which would have a massive impact on inherited property portfolios:

• CGT on Original Purchase Price: Currently, when an asset is inherited, CGT is calculated based on the asset’s value at the date of death. The new proposal would force people who inherit assets (such as properties) to pay CGT on the change in value since the asset was originally purchased by the deceased owner. This change would potentially lead to much higher tax bills upon the sale of inherited property.

Analysis

These proposals signal a clear direction of travel from influential policy thinkers towards taxing capital and property more heavily. If adopted, these reforms would transform the economic viability of the private rented sector and dramatically increase the costs associated with owning and inheriting high-value assets in the UK.

While these remain proposals from a think tank and are not confirmed policy, they highlight the intense pressure on the next government to find new revenue streams to fund public services.