Protect cash ISAs

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Protect cash ISAs

Chancellor Rachel Reeves

Rumours are swirling that Rachel Reeves might slash the tax-free cap on cash ISAs from £20,000 to £4,000 - after meeting with a group of bank executives. [1]

Cash ISAs (individual savings accounts) are the most popular kind of savings account in the UK. Tax-free and low-risk, they help 18 million of us to save billions for a rainy day.

But the Chancellor is being lobbied by big city firms to cut the allowance so that savers are pushed into moving their money. Reducing the cash ISA limit - while keeping the stocks and shares ISA allowance the same - would unfairly push people with little savings into making riskier investments.

No one should be forced to gamble their savings to help rake in *even more* profits for City bankers. After u-turning on bankers bonuses, we can’t let Labour bend to the will of big banks again. The government should not restrict cash ISAs.

Tell Rachel Reeves to #ProtectCashISAs - add your name to the petition now.

[1] The Guardian: Savings providers vow to fight any attempt to cut cash Isa limit to £4,000

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To: Chancellor Rachel Reeves
From: [Your Name]

Dear Chancellor Rachel Reeves,

Following reports in the press that you’re considering cutting the tax-free cap on cash ISAs from £20,000 to £4,000, I’m writing to strongly ask you to reconsider. [1]

As the most popular kind of savings account in the UK, Cash ISAs help 18 million of us around the UK to save billions for a rainy day, retirement, or special occasions. No matter what we’re saving for, we shouldn’t be punished for not gambling our money on riskier alternatives, like stocks and shares ISAs, if we don’t want to.

Reducing the cash ISA limit while keeping the stocks and shares ISA allowance the same, would be unfairly pushing people who have little savings to make riskier investments, when savings should all be treated the same.

The public are not the only ones concerned. As the Building Societies Association outlined in their open letter to you, cash ISAS “represent a policy success upon which we should seek to build, rather than to curb”. [1] It’s not true that cash ISAs do not support economic growth, nor that growth would be boosted by diverting funds away from cash ISAs and into alternative bank products.

If you’re looking for a source of additional tax revenue, you could turn to the big banks themselves. Following another record year of profits in 2024, a windfall tax on the big four banks could bring in £15 billion alone. [3] Since banks have made these billions due to years of higher interest rates, while UK citizens have suffered a cost of living crisis, a tax on banks would seem a much fairer place to start than taxing the accounts of ordinary savers.

Please Chancellor, will you protect cash ISAs?

Yours sincerely,

References:
[1] The Guardian: Savings providers vow to fight any attempt to cut cash Isa limit to £4,000; https://www.theguardian.com/money/2025/feb/20/savings-providers-vow-to-fight-any-attempt-to-cut-cash-isa-limit
[2] The Building Societies Association calls on the Government to save cash ISAs:
https://www.bsa.org.uk/media-centre/press-releases/the-building-societies-association-calls-on-the-government-to-save-cash-isas
[3] Positive Money: Windfall tax on bank profits could raise £15bn; https://positivemoney.org/press-release/windfall-tax-on-bank-profits-could-raise-ps15bn/