Ashley Webb, UK economist at Capital Economics, a consultancy, said: “While reducing the tax-free allowance on Isas would raise revenue for the Treasury, it won’t help lift the UK’s low level of investment.
“Investment in the UK is five percentage points of GDP lower than in other G7 economies, and part of that is due to the UK’s low saving rate.”
[…]
Philip Shaw, chief UK economist at Investec, the investment firm, said: “The most obvious reason why [deposits have jumped] is that interest rates have risen materially above zero.” Webb agreed, noting that elevated interest rates had “provided households with a greater incentive to make use of the annual Isa allowance”.