Budget 2026: Healey reverses Reeves’ cash Isa cut

John Healey has scrapped plans to slash the cash Isa allowance in his maiden Budget, ending the controversial measure introduced by his predecessor. Healey has confirmed the ceiling on the savings product will remain unchanged at £20,000 instead of being cut to £12,000 from April 2027. The cutting of the allowance was designed by former chancellor Rachel Reeves to funnel cash into UK companies and get more Brits to invest in the stock market. But Healey argued this was the wrong approach to persuade people to invest more in stocks and shares. He said: I am taking a new approach today to encourage people on ordinary incomes to save and to invest, I will not go ahead with the cut to the tax-free amount that people can put into a cash ISA. The limit will stay at £20,000 per year, tax-free, for people of all ages. He also promised to work with the investment sector to create a new Starter Isa aimed to reward first-time investors . Isas are exempt from tax on interes