Budget is 'confusing for savings account users'
23 April 2009 14:00:00
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| Chancellor's message to consumers is "inconsistent". |
The Budget's message to savings account users is confusing, one investment firm has claimed.
Alistair Darling's Budget contained proposals to end tax relief on the pensions of those earning over £150,000.
These high earners will also see income tax increase from 40p to 50p.
At the same time the annual Isa threshold will be increased from £7,200 to £10,200 - of which £5,100 can be held in cash.
This will take place in October for consumers aged over 50 and from April for all Brits.
Jasper Berens, head of UK Retail at JP Morgan Asset Management, said that increasing ISA limits shows that the government understands their importance and the need for the UK to save more money.
"However, by limiting tax relief, albeit only on high earners, the government is penalising those who are already making an effort to save and invest for their futures as well as limiting the appeal of another effective long-term savings mechanism."
Related Blog articles: New ISA allowance for 2009 to 2010
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