Brown secures ISA limits till 2010 |
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Published
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Fri, 18 Mar 2005 01:00
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In his pre-election budget, Gordon Brown announced the annual tax-free ISA allowance to be held at the current £7,000 till April 2010. This declaration came as a great relief for savers since Brown had previously planned to cut the annual tax free ISA amount. The amount would however be reviewed after April 2010.
Children’s savings also received a considerable boost with the chancellor suggesting Child Trust Fund payments not only in primary school but in secondary school years as well. This did quite a bit to pacify the savings industry, which had otherwise been fuming against Brown’s plans to slash allowance levels.
| The ISA allowance freeze did attract quite a few opinions from the industry with Mark Campbell, head of UK retail business at JP Morgan Fleming welcoming the move and director general of the Association of Investment Trust Companies, Daniel Godfrey hoping that it would work well towards pulling people back into the ISA market. He also said that in addition to the need for specific incentives for the low income groups, support through a fully funded financial education program was required to effectively strengthen the savings culture of UK.
Meanwhile, Richard Wastcoat, UK managing director of Fidelity Investments called for the restoration of the dividend tax credit for equity ISAs, saying that Brown should make a positive move by raising the maximum contribution limits for Isas, which in turn would augment savings in a great way.
Likewise, accountants of Deloitte estimated Isa managers to earn £2 billion in charges till April 2010, based on ISA investments over the last six years, while Christine Ross, of SG Hambros private bank believed it was just about creating a feel good factor for the savers.
Similarly, Gavin Oldham, chief executive of The Share Centre, the retail stockbroker and Isa manager claimed that the Government had not done much to encourage investors and this Isa extension was nothing more than a pre-election gimmick.
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