To ask the Chancellor of the Exchequer
(1) if he will list increases to the premium limit of tax exempt savings plans since 1992;
(2) what estimate he has made of the cost to the Treasury of raising premiums of tax exempt savings plans to (a) £600 per annum and (b) £1,200 per annum.
The premium limit for tax exempt savings plans was increased from the 1992 level to the current level on
The estimated current cost of tax-exempt savings plans, with an annual premium limit of £300 is around £70 million per year and in recent years this cost has been increasing at an annual rate of about 10 per cent.
Increasing the limit to £600 or £1,200 per annum would potentially cost the Exchequer an extra £30 million or £120 million per year respectively in the long run. Doubling the limit would not necessarily double the cost because many tax-exempt savings plan customers do not save at the current maximum.