Treasury could target 3m pension savers to plug budget hole

With public borrowing expected to increase by more than £500bn over the next five years, Skandia believes higher rate tax relief on pensions could be a prime target to raise extra revenue. From 2011, higher rate tax relief on pension contributions will be withdrawn for those earning £150,000 or more each year. However, the measure is only likely to raise around £3.1bn, a relatively minor sum for the Treasury. Skandia says far more significant revenues would be generated by removing higher rate tax relief for all 3.3m high rate taxpayers. In the past, significant tax reliefs, inc...