It makes sense if you’re going to be consistent with all the taxes on passive income we slap on those who invest in stocks or a business or whatever, rather than a McMansion on a hill.
(My answer would be to tax neither, but that’s another story.)
not to be too cynical but if we are going to continue to have an income tax, all income from whatever source derived MUST be taxed, or not taxed, on the same basis. That would allow individuals to treat themselves as a business and end up owing very little ~ at the lower end of the income spectrum.