Which of your taxes will Rushi raise?

He has a £400bn black hole to fill. Which taxpayers will bear the brunt in the Budget next month, asks Harry Brennan

Rishi Sunak is mulling a number of tax rises with less than a month to go before he announces the Budget on March 3. The Chancellor is tasked with plugging a £400bn forecast black hole in the public finances this year and Westminster is awash with rumours about how he plans to deal with it. Mr Sunak has already laid the groundwork for some drastic changes and has warned backbench Conservative MPs of tough times ahead.

Everything hinges on the state of the Covid crisis. Tax changes could come in as soon as April or arrive later in the year. It will depend on the progress of the vaccine rollout, whether lockdown restrictions will be lifted or whether Mr Sunak will be forced to fund yet further bail-out programmes.

What options are on the table? Telegraph Money looks at the runners and riders and the odds for each.

Plans being considered for a new annual property tax based on today’s house prices would do away with council taxes, which are based on house price data from 1991, as well as stamp duty, which is often blamed for stopping people from moving.

It would fit with the Government’s “levelling- up” agenda, as it would bene fit the owners of lower- value homes in the North and elsewhere, but would prove unpopular with many of its core voters in the South, where property prices are highest. The Conservatives dropped previous attempts to re- evaluate council duties and Mr Sunak is sceptical of the idea ( 4/ 10 chance – unlikely).

Proposals for higher rates and lower reliefs on capital gains tax could raise £18bn a year and mean up to three times as many people would have to pay. The Chancellor himself commissioned a review by the Office of Tax Simplification last year, but insisted it was part of ordinary Treasury business. Experts said the historically low rates of CGT were an easy target for extra revenue, albeit a relatively small amount. It would hit investors and second-home owners (6/10 chance – reasonable possibility).

The Chancellor has also hinted heavily at harsher taxes for freelancers, saying everyone who benefited from state help during the crisis would have to pay the same in future. This is likely to see the lower rates of National Insurance the self-employed pay brought into line with the rates employees pay.

It would be a blow to freelancers, who have been hit especially hard by the pandemic, but is broadly supported by think tanks such as the Institute for Fiscal Studies. The IFS has said it is unfair that someone who earns £40,000 a year will pay £3,300 less tax if they are a sole trader, or £4,300 less if they are a company director, than an employee who earns the same amount (7/10 chance – more likely than not).

A one- off 5pc wealth tax on individual property and pension assets of more than £ 500,000 would raise £ 260bn over five years, according to the Wealth Tax Commission, a group of influential think tanks and academics. Mr Sunak has ruled out this policy, which would hit more than eight million people.

It would take the worst-case doomsday scenario for Britain to introduce a wealth tax along the lines of the one already adopted by nations such as Argentina because of the pandemic (2/10 chance – extremely unlikely).

It is understood that Mr Sunak views forcing firms to pay more as the fairest way to raise revenue, as they have either profited from the crisis or been kept afloat by state handouts. It would hit landlords who have moved their properties into company structures to escape increasingly harsh tax treatment of buyto-let in recent years. But it would allow Mr Sunak to raise money while sticking to the Tory manifesto pledge of no increases in income taxes or VAT.

Britain has the lowest corporation tax rate in the G7 at 19pc. Raising the rate by two percentage points would raise £6.8bn a year by 2024, according to government estimates