Camilla Stowell, CEO wealth at Rathbones, has called on the Government to support the people driving the UK economy ahead of the Budget.
Rathbones’ research, Building Prosperity, found professionals, business owners and families were concerned about their financial futures.
It highlighted five areas for the Government to address: pensions, wealth taxation, business tax, public investment and property taxation.
Stowell said: “Our clients are the people whose ambition and success underpins the prosperity of businesses, organisations and communities across the UK.
“If they aspire and succeed in their professional lives, businesses and personal decisions, the whole country stands to gain.
“But many now feel anxious about the future, worried about their ability to live well in retirement, support their families, or grow their businesses.”
Stowell added: “We worry that the government may lose sight of the need for aspiration, and to support and encourage people to strive, build and succeed – because this is how the economy and country will succeed and grow.
“Short-term tax changes which undermine this may ultimately further slow economic growth.”
Rathbones called for stronger incentives for pension saving and warned against cutting higher and additional rate tax relief.
The firm estimated that reducing relief could cut pension saving from higher-rate taxpayers by over £50bn in five years.
It also recommended more generous capital allowances and reform of business rates, estimating that extending 100% capital allowances could add up to £60bn to UK GDP.
The group said the Government should focus public investment on regions and sectors needing it most, especially in transport and energy infrastructure, to boost private sector growth in the North and other regions.
Rathbones warned against new wealth taxes, estimating that an annual wealth tax could drive over £100bn out of the UK or into less productive assets.
It also called for changes to Stamp Duty Land Tax (SDLT), saying it was limiting activity in the housing market and household mobility.
Rathbones estimated that abolishing or reforming Stamp Duty could boost home moves by over 25%, or 300,000 extra transactions a year.
Stowell said: “It’s not our role to resolve every economic challenge, but as one of the UK’s leading providers of wealth management, we have a duty to give voice to those who are building the country’s future.
“We urge the Chancellor to focus on policies that encourage aspiration, investment and growth.”
Oliver Jones, head of asset allocation at Rathbones and lead author of the analysis, said: “Our analysis shows that the right policy choices now could unlock billions in investment and help secure the UK’s long-term prosperity.
“But short-term fixes like cutting pension tax relief or introducing a wealth tax risk draining capital from the very businesses and individuals who drive growth.
“The government should focus on creating a stable, predictable environment that encourages people to save, invest, and build for the future.”
