Finance bill railroaded despite pensions fears
Treasury brushes aside pension industry fears over finance bill
The Treasury has brushed aside pension industry fears that proposals in the finance Bill to allow residential properties to be held in personal pension funds could cost the industry £4bn.
The legislation re-introduces avoidance crackdown clauses – with some concessionary amendments – which had to be dropped from the finance bill rushed through the Commons before the general election. It is due to be approved in principle tonight in the Commons, where it is expected to receive a second reading.
The industry has warned chancellor Gordon Brown that the proposal to allow individuals to hold domestic property in self-invested personal pensions (Sipps) could prove extremely expensive to the Exchequer if they encourage large numbers to change their pension investment patterns to include property.
But a spokesman for the Treasury said the concession would cost nothing like £4bn, a figure forecast by Standard Life.