Suspend income tax on savings, urges action group

In a letter to Chancellor George Osborne, Save Our Savers said people are seeing their capital "whittled away" by a prolonged period of negative real interest rates. It added savers are required to pay income tax on the interest they receive "as if it is a gain even though the real value of their savings is declining". The letter comes as new research indicates households may cash in their savings when the Bank of England raises interest rates, which are currently at a historic low of 0.5%. A MoneyMood survey by insurer Legal & General (L&G) suggests 10% would withdraw from savings...