JEREMY Hunt has announced a new “British Isa” in his Spring Budget 2024.
The Chancellor said he intends to reform the Isa system and give investors a £5,000 extra tax-free allowance to encourage more people to invest in UK assets.
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Hunt called it good news for savers who can benefit from the growth of British businesses.
He said: “After a consultation on its implementation, I will introduce a brand new British Isa which will allow an additional £5,000 annual investment for investments in UK equity with all the tax advantages of other Isas.
“This will be on top of the existing Isa allowances and ensure that British savers can benefit from the growth of the most promising UK businesses as well as supporting them with the capital to help them expand.”
Mike Ambery, Retirement Savings Director at Standard Life, part of Phoenix Group said: “ISAs represent a significant pool of savings and the Chancellor is hoping he can encourage people to buy British.
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“The big question is whether today’s incentive will be enough to encourage people to invest at home.”
Brian Byrnes, Head of Personal Finance at Moneybox, said: “While the British ISA may stand to benefit British businesses in time, and we welcome any reform intended to encourage investing, it is unlikely the British ISA will deliver real benefit to the vast majority of retail investors.
“The fact is that with a very small minority of investors currently able to max out the current £20,000 tax-free limit, the additional £5,000 allowance will likely solely benefit a small group of wealthier investors who are able to take advantage of it.”
