The trade association sees Osborne’s stated desire to move from an economy built on debt to an economy built on the ‘more secure and productive foundations of saving and long term investment’ as a very welcome development.
The changes announced are ‘a boon’ to shifting the way people in the country think and will help them to look positively at long term planning for their financial futures, according to the WMA.
The WMA was also pleased by the announcement of a Green Paper consultation on reforming pensions tax relief and plans to ‘work closely with HM Treasury’ on it.
“Cutting pensions tax relief sends an anti-saving message whatever guise it is in – whether a person earns £30,000 or £150,000, creeping taxation puts people off investing and saving for retirement and dis-incentivises those earning and saving less from trying to earn and save more in case they get caught by taxes coming lower and lower down the scale,” said CEO of the WMA Liz Field.
“These changes come after the Chancellor’s widely publicised pensions freedoms just four months ago; we must be mindful that constant shifts in Government policy can create confusion and be counterproductive to significant savings and investment objectives,” she said. “The cultural shift that the WMA and the Chancellor are keen to promote has had a further boost today, but tax changes such as this may encourage people to spend their pension money, rather than keeping it for the long term.”
“However, many of the messages from this Budget highlight that the Government understands the importance of savings and investment and the policies announced show that we are heading in the right direction – we should all strive to commit to this aim,” Field added.
