Reeves Faces Backlash Over Possible Cash ISA Cut

Chancellor Rachel Reeves is reportedly considering reducing the annual Cash ISA limit from £20,000 to between £10,000 and £15,000 to encourage investment in Stocks and Shares ISAs and stimulate economic growth. The proposal has been met with strong opposition from building societies, financial associations, and experts, who argue that Cash ISAs are vital for personal savings and affordable lending. Critics warn that lowering the limit could increase borrowing costs for homeowners and hinder the government's housebuilding targets. Some experts contend that changing the limit will not significantly alter saver behavior, as funds may be moved to non-ISA accounts, leading to higher tax liabilities. Prominent money expert Martin Lewis noted that any changes would not affect existing ISA deposits and proposed introducing a 'starter investment ISA' as an alternative reform. Industry groups are urging the government to focus on consumer investment education instead of reducing support for cash savings.