PLSA AC 2020: Pension tax relief reform could save govt £10bn – Andrew Neil

The government is “looking at” pension tax relief reform, which could potentially bring in around £10bn, according to journalist and broadcaster, Andrew Neil.

Closing the PLSA Annual Conference 2020, Neil stated that although tax rises to pay for the deficit exacerbated by Covid-19 were unlikely, reforms to pension tax relief “could be made”.

“There are some reforms that could be made, for example to pension tax relief, which the government is looking at. It would bring in a lot of money,” Neil said.

“If you were to unify it round the 20 per cent basic rate of tax relief rather than the top rates, it could bring in about £10bn. Nice for the government to have.”

He noted that reforming pension tax relief would “largely affect the better off”, although as the Conservatives are now “a party of the north as well as the south, that could appeal”.

“You could see some changes like that, but not any huge rise in taxes,” he added.

Neil also spoke on the UK economy and its potential recovery. Although he was “hopeful” of a recovery in early 2021 a couple of months ago, the new restrictions introduced over the past few weeks have made him “less hopeful”.

“My fear now is that with these extra restrictions the economy in Q4 will now stagnate, we will stagger into Q1 of next year and we will limp through the first quarter as well,” he continued.

“Although it will not be back to that Q2 [2020] disaster, it will not be that V-shaped recovery that looked possible in the mid-summer of this year.”

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