Minister has his eye on your property

WANT to really put the wind up yourself for a property shock in next week’s budget? Consider the appalling, outside-shot vista for home-owners that mortgage interest relief could be tinkered with, reduced, or phased out.

Although suggested as a target by a recent OECD report, which said there was no argument for tax relief on mortgage payments, hard-pressed home owners will hope and pray that this slender measure of relief for the man in the street and the man, woman and child at home won't be altered a whit. (It has already been reduced to an allowance at the lower rate of tax only, in a previous budget change.)

With interest rates internationally set to rise in 2004, the impact on the monthly domestic budget of any tax relief change could be crippling. That's ever before next year's home-buyers get hit by increasing development levies being slapped on new homes by local authorities as a creeping onslaught of stealth taxes. Remember last year's sneaky 1% rise in VAT and the scrapping of the First-Time Buyer's Grant?