Conservatives complete hat-trick of stealth taxes with over £750 million raid on savers

27 Nov 2023

EMBARGO: 22.30 Saturday 25th November 2023

By holding down tax free limits on ISAs the government will have raided savers of £755 million between 2023 and 2029, measures in the small print of the Autumn Statement reveal

The Liberal Democrats have slammed the Autumn Statement’s latest hidden horror as an “act of deception” as it will continue the freeze on tax free limits for ISAs which will have cost savers £755 million between 2023 and 2029.

The measures relate to Individual Savings Accounts (ISAs). New schemes in the Autumn Statement will equate to an additional £55 million for those with an ISA over the next five years, but the government will take away far more by continuing the freeze on tax-free limits for ISAs.

Conservative Chancellors have frozen ISA limits every year since the start of this Parliament, hitting savers as inflation rises. This will deny savers an additional £755 million between 2023 and 2029.

Nearly half of this tax raid is a result of this week’s Autumn Statement, with the Chancellor’s decision to freeze thresholds for 2024-25 giving the Exchequer an extra £305 million in the years running up to 2029 if they remain frozen.

The tax raid dwarfs the £55m for savers announced by the Chancellor.

The Liberal Democrats have called this “another act of deception” after the Chancellor claimed that his Autumn Statement would result in tax cuts when the overall tax burden will actually increase. It equates to a hat-trick of stealth taxes, with thresholds for income tax and NICs also remaining frozen.

Liberal Democrat Treasury spokesperson, Sarah Olney MP said:

“This is yet another act of deception from an Autumn Statement that was packed full of tax rises and raids on people’s wallets.

“The Statement was all about taking money out of people’s pockets to pay for this Conservative government’s crashing of the economy.

“Their mismanagement of the public finances is now having real consequences for those trying to get on the housing ladder and fulfil their dream of owning a home.

“This Conservative government has denied them of that opportunity and it adds insult to injury for working people that Ministers cannot be honest about it.”

ENDS

Notes to Editor:

Analysis of the stealth tax on ISAs since the beginning of the Parliament can be found here.

ISAs have been frozen every year since the beginning of the Parliament. The measures began to raise revenue for the Treasury this year (2023-24) and will be raising at least £130m a year by 2028-29. In the years running from 2023 to 2029 they will have raised at least £755 million for the Treasury.

The government announced a number of measures for savers here (“ISA” - Individual Savings Account).

These measures cost the Govt £55m over the next five years - here.

But the Govt’s decision to hold ISA, JISA, LISA & CTF Annual Limits at their current levels for 2024-25, costs savers £305m - here.