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Trade bodies urge rethink on Isa tax credit

Six trade associations are clubbing together to urge Chancellor

Gordon Brown to scrap plans to abolish the 10 per cent tax credit on

equity Isas in April 2004.

The Investment Management Association, the Pep and Isa Managers

Association and four other bodies, including Aifa and the AITC, have

written to the Chancellor seeking an urgent meeting to discuss the

effect that dropping the credit would have on savings.

The six, which include Apcims, the European Association of Securities

Dealers and Proshare, believe that removing the tax cre-dit would

discourage lower-income groups from saving in a stocks and shares Isa.

They say the move means equity Isas will only benefit higher-rate

taxpayers who will pay the same 10 per cent level as basic taxpayers.

Outside an Isa, higher payers pay 22.5 per cent on income dividends.

IMA chief executive Richard Saunders says: “At a time when the

Government is trying to encourage the savings habit at all levels, it

seems perverse to remove a tax benefit for those on lower incomes.”

Pima director general Tony Vine-Lott says: “Our research shows that

if the tax-free benefit is reduced or abolished, only a third of

customers would continue to invest in these products.”

A Treasury spokesman says: “The credit was always just a transitional

measure. Investors will still pay no tax on investment returns.”


Manor Park – Guaranteed UK Selected Growth Fund

Tuesday, 25 March 2003 Type: Guaranteed growth bond Aim: Growth linked to the performance of the FTSE 100 index Minimum-maximum investment: £5,000-no maximum Term: Three years Guarantee: Choice of 85%, 90%, 95% or 100% of capital returned in full regardless of the performance of the index Return: 160%, 120%, 80% or 40% growth dependent on […]

New illustrations give even less incentive to save

So now we have the real pension projections, which will make the hilllook steeper and the accumulated funds look smaller. If the powersthat be really believe this is going to be an incentive to themajority to increase their savings efforts, then they really are asstupid as we fear.I wonder if, in formulating their policies, they […]

Platform on the move

Only two months after the launch of Platform as Britannia BuildingSociety&#39s intermediary lending subsidiary, following the merger ofPlatform Home Loans and Verso, the firm is in bullish mood, ifslightly overwhelmed.Sales and marketing director Guy Batchelor admits that, on the levelof business brought in by Platform since it opened its doors asBritannia&#39s “one-stop shop” for specialist […]

Ride on mortgage-go-round will cost lenders £3bn

Chasing new mortgage business will cost lenders £3bn over thenext two years and is one of the biggest challen-ges facing theindustry, says a report from PA Consulting Group and the Council ofMortgage Lenders.The report, called Stuck on the Mortgage-go-Round, says thisspiralling cost of what it describes as “churning” mortgages comesfrom lenders having to find and […]


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