Pension tax raid ‘least popular’ Labour Budget proposal, bombshell poll finds
A recent survey by AJ Bell has revealed that two-thirds of Britons are worried about potential tax increases in the upcoming Budget.
The poll found that 66 per cent of respondents expressed concern over the impact of tax hikes on their personal finances with a rumoured raid on pension pots being the “least popular” proposal.
Some 28 per cent of those surveyed supported an increase in taxes, while 30 per cent favoured a decrease.
The findings come as Chancellor Rachel Reeves prepares to deliver her first Budget speech.
Notably, restrictions to pension tax relief emerged as one of the least popular measures, garnering support from just 22 per cent of respondents.
Capital gains tax hikes received the most backing, with 44 per cent in favour.
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More pensioners are at risk of paying extra tax
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Dividend tax increases saw 38 per cent support, while 30 per cent approved of raising inheritance tax.
Over half (54 per cent) of respondents backed an increase to the higher rate of income tax.
Even more striking, nearly two-thirds (65 per cent) believed those in the additional rate tax bracket should face higher income tax rates.
Interestingly, a wealth tax on personal assets found favour with more than half (53 per cent) of those surveyed.
Despite these concerns, three-quarters (74 per cent) of Britons have yet to take steps to prepare for potential tax increases. Of those who have acted, a third (32 per cent) have utilised ISAs to shelter money from taxation.
Tom Selby, director of public policy at AJ Bell, emphasised the unpopularity of restricting pension tax incentives among the British public.
He explained: “The Government should harness that general feeling from the public to commit to a Pensions Tax Lock, delivering stability in the pensions tax system for at least the remainder of this Parliament.”
“Not only would this demonstrate that Labour really is on the side of working people who have saved for the whole of their careers to achieve a good standard of living in retirement, but it could turn much of the recent negative media attention around a pensions tax raid on its head.”
“Labour is unlikely to renege on its workers triple-lock of not increasing income tax, National Insurance or VAT, but perhaps this is the clearest indication yet of the extent to which the party has boxed itself in on the most powerful tax levers it could pull to raise money to fund public services.”
Despite the limited options for raising revenue, Selby pointed out that some measures under consideration do receive public support.
He noted: “Indeed, 44 per cent would be in favour of an increase in capital gains tax, something that appears increasingly likely to feature in the chancellor’s speech next Wednesday.”
A UK Government spokesperson said: “We do not comment on speculation around tax changes outside of fiscal events.”
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