Hammond to target pensions
According to the Times, the Chancellor will launch a new tax raid on pensions to plug the £2bn black hole in the Budget that was left after the U-turn over NICs. Under one plan likely to be considered, the Treasury could bring in one flat rate of tax relief for everyone, likely to be less than 30p in £1. However, insiders say that because this would be seen as a kick in the teeth for the middle classes, the Chancellor is far more likely to reduce the annual amount that people can pay into a pension fund - from the current £40,000 threshold to £35,000 or even £30,000. Sir Steve Webb, the former pensions minister, said lowering the annual allowance to £30,000 could raise “approaching a billion” pounds a year and a move to £35,000 would be “approaching half a billion”. He added that “hundreds of thousands of people” could be affected.