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Budget reaction: Help-2-buy ISA Grant Thornton UK LLP

Kersten Muller, Head of Real Estate Tax, Grant Thornton UK LLP, said:

“The Chancellor delivered his last Budget before the General Election in a few weeks’ time. Initially there seemed to be little for the real estate industry although a welcome review of business rates was announced.

“Then the interesting announcement of boosting the savings culture in the UK, comprising the fully flexible ISA, the Help-2-Buy ISA and the changes to annuities. The Help-2-Buy ISA effectively provides a 25% top-up for first time buyers, and is undoubtedly welcome news to aspiring homeowners. The top-up is capped at £3,000 (for those saving £12,000) but the measure does not deal with the current housing shortage or the lack of supply of suitable housing. Our concern is therefore that the boost provided through the tax system could result in higher demand and ultimately lead to higher house prices.”