Jim Cunningham – 2016 Parliamentary Question to the HM Treasury
The below Parliamentary question was asked by Jim Cunningham on 2016-03-22.
To ask Mr Chancellor of the Exchequer, what estimate his Department has made of the total contribution from the public purse to Lifetime ISAs in financial year (a) 2017-18 (b) 2018-19 and (c) 2019-20; and if he will make a statement.
Harriett Baldwin
The Government is creating a new Lifetime ISA, providing savers with the flexibility to save towards a first home and retirement at the same time. From April 2017, people aged 18 to 40 will be able to open and save up to £4,000 each year into a Lifetime ISA and receive a 25% bonus from the Government, paid annually after the end of the tax year.
People can make full withdrawals from their Lifetime ISA accounts for a first home purchase (subject to a house price cap of £450,000 UK-wide) or from age 60. These withdrawals will be tax free.
An estimate of the Exchequer impact from this policy was set out in Table 2.1 of the Budget 2016 document. For further information, please see page 9 of the Budget 2016 Policy Costings document: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/508147/PU1912_Policy_Costings_FINAL3.pdf
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