The Isa consultation announced in the pre-Budget report could open the door for an increase to the savings limits in next spring’s Budget, says Cicero Consulting.
Director Iain Anderson says the consultation is positive news for the industry.
He believes industry submissions will overwhelmingly call for a rise to the current investment limits and pressurise the Government into implementing a rise.
Providers will have until the end of January to respond to the consultation, which is to run separately from the Treasury’s Isa review that ended last month.
Chancellor Gordon Brown formally announced in the pre-Budget report that Isas are to become permanent and indicated a change in the rules to allow transfers from cash to equities without effecting the annual limits.
But he left any possibility of an increase in the annual limits until after January’s consultation.
The industry has been unanimous in its support for the Treasury to increase the 7,000 limit as a way of incentivising more people to save more.
Anderson says: “There is a strong possibility of a rise to the Isa limits in the next Budget after this latest announcement, as the industry will be putting significant pressure on the Government.”