Fri, 24 Oct 2025

Fri, 24 Oct 2025 Reeves should not cut cash ISA allowance, MPs say

The Chancellor is reportedly trying to revive plans to cut the tax-free limit for Cash ISAs.
Reducing the £20,000 limit, which is currently spread across products including cash Isas and stocks and shares Isas, was being considered to encourage people to invest their money instead of saving it. However, the committee concluded that cutting the allowance would not incentivize people to invest in stocks and shares. Instead, the committee recommended that the focus should be on improving financial literacy so that people can make informed decisions with their savings. The report also stated that building societies depend on cash Isas for mortgage lending, and reducing the limit would lead to a less competitive market and higher prices for consumers. The committee's chair, Dame Meg Hillier, said: "This is not the right time to cut the cash Isa limit." She added that the government should focus on improving financial education and providing accessible, high-quality financial advice and guidance for people.
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