One of the most cunning tricks up the sleeves of the Exchequer is so-called “fiscal drag”: the way that the government can raise more income simply through inflation.
That is because unless tax thresholds rise in line with prices, people slip into higher bands: for example the upper rate of income tax. And they may not even notice.
It is a politically less painful way of raising extra tax than by visibly lifting rates at Budget time.
Property is a case in point: According to new research published today, the Treasury could see an extra haul of £2bn a year through stamp duty if house prices continue to rise as anticipated by experts.