Cost of higher rate pension tax to cancel out gains

From April 2011, the Government hopes to raise an extra £3.6bn a year, partly through cutting the tax relief on pension contributions for people earning over £150,000. People with gross pay of just £130,000 could be hit if the benefit of their employers' contributions pushes them above a proposed £150,000 limit. But Standard Life says implementing the tax, which will hit around 300,000 people, will cost around £2.5bn. This is seven times higher than Treasury calculations which put estimate the figure at the £345m mark. The insurer says the Treasury figures fail to account for major...