Key facts
- Chancellor John Healey will retain the £20,000 annual cash Isa allowance.
- The previous plan was to cut the allowance to £12,000 from next April.
- The decision aims to encourage investment in stocks and shares.
- Some experts believe phasing out cash Isas could generate significant tax revenue.
UK Chancellor John Healey is set to maintain the annual cash Isa allowance at £20,000, reversing a plan by his predecessor, Rachel Reeves, to reduce it to £12,000. The move, expected to be announced in his budget on Wednesday, aims to encourage greater investment in UK stocks and shares. City experts largely welcomed the decision, viewing the £20,000 allowance as a simple and understandable option for savers. However, some argued that the government missed an opportunity to boost long-term wealth building and business investment.