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Savings timebomb still ticking

Building societies and high-street banks say this week&#39s Budget does nothing to help savers or homebuyers.

Harshest comments have come from West Bromwich Building Society, whose chief executive Andrew Messenger has called the Budget a kick in the teeth for savers and borrowers. He believes failure to address the saving issue is creating a savings timebomb.

Halifax says the Chancellor&#39s position on stamp duty and inheritance tax is not good news for homebuyers. Group economist Tim Crawford says Brown has disappointed homebuyers by failing to reduce the increasing burden of stamp duty and inheritance tax.

Failing to ensure that the thresholds for these taxes increase in line with house price inflation has dealt a blow to homebuyers, according to the Halifax. It points out that stamp duty revenue is estimated to have increased by more than £700m in 2003/04.

Nationwide says it is disappointed that the Chancellor has failed to take action to encourage savers or help first-time buyers.

The building society wants the Government to reconsider its plans to reduce the tax-free savings limit in cash Isas. It also wants stamp duty to be abolished for first-time buyers.

Executive director Stuart Bernau says: “The Chancellor has missed an opportunity to make a real difference to a wide range of people, from first-time buyers to savers of all ages.”

Messenger says: “This is a kick in the teeth to millions of hard-pressed savers and borrowers.

“The Chancellor has done nothing to relieve the pension and savings crisis and stamp duty is simply a stealth tax that has swollen the Government&#39s coffers from £0.7bn in 1996 to £3.6bn as average house prices have gone up.”

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