<b>PBR:</b> Pensions U-turn puts industry in a spin. By Nichola Ross Martin

but he has already presented this as closing a loophole - so how long before it is included in the statistics he presents to paint a bad picture of tax avoidance, and then claimed as his positive action to fight it?

I think you all need to take a good look at what is going on here ? He is making us all look like idiots. We need to come together on this one and stand up for what we believe in !

Peter, but can you remind me exactly what it is that we should all stand up for, and believe in, in respect of this particular shenanigans?

That we should have sensible, thought through policies rather than all this sudden direction changing? Agreed.

That the Govt should give sexy tax breaks for higher rate tax payers on all forms of pension savings, thereby encouraging all the ludicrous schemes we have seen peddled in last few months? I think not.

This was obviously all a simple ruse in order to ensure re-election.

GB knows that property and BTL are an issue very important to the UK mind and economy and so by apparently pushing this button 2 years ago, he made pensions interesting and made the public prick up its collective ears. It certainly didn't put the public off from voting Labour!

However, now the TB govt are back in power, he has withdrawn the tax concession. I must admit I was against it from the very start and clients who were already seasoned property developers/BTLrs knew it was a non-starter as the whole scheme is too inflexible.

But the way they get away with U-turning so blatently is breathtaking!

3 days.

Entry, exit and management charges plus contractual terms designed punish investors at every turn are the reasons for deterring would be investors. There is a point where I would agree with the industry however, and that is that Brown is unfit to be chancellor, not to mind PM.

The most disappointing element of the pre-Budget statement, to me, is the element of hysterical over-reaction.

The existing legislation in FA 2004 provides for tax charges (up to 70%) if a member actually uses a scheme asset. Surely that is enough to cope with "fine wines, classic cars and antiques"...? Not to mention holiday homes here and overseas.

Why, then, does Gordon feel it necessary to impose an additional, identical set of charges on the actual investment - regardless of whether the asset is actually used by a member - and upon any income it brings in?

As for the business of "deeming" an income if the investment doesn't actually generate one... why not go the whole hog and reintroduce old-style Schedule A?

As SOGG and others point out (and as I do regularly on the lecture circuit), very little SIPP money was ever going to end up in residential property in the real world. For such as did, the original tax regime was quite robust enough. This whole thing smacks of a Chancellor who has no long-term idea of what he is really trying to achieve, and who is just making it up as he goes along.

I suspect vey few. There has been a steady drip drip drip of articles in the press and notes from financial intermediaries saying how wonderful these new opportunities are- but a prudent analysis of the practical problems showed that for most people buy- to- let , quite apart from antiques or fine wines-were singularly inappropriate, and very expensive to manage.

The government's handling of this has been inept, and undoubtedly some people will have short term losses, but in a few months the whole fuss will blow over and more considered investment criteria can be followed.

For myself, I have started a SIPP to reduce insurance company charges, but the underlying investement criteria I shall follow will remain as before. I did look at commercial property - never at "buy-to-let"- but there is a "wall of money" chasing these at present and prices are unattractive. I found it interesting that none of my clients who have experience of the property world felt that "buy-to-let" was attractive now.

it is the entitlement of the Government or so called experts to tell people how to invest their money !!!

How they do they know what a prudent investment is !!

If there are tax advantages on offer to fund retirement and people wish to spend on wine at least they can enjoy it while they contemplate Gordon Brown and his dismal reign

It seems a good move to withdraw investment in property, as any downturn would seriously damage such pension funds.

The economy is very vunerable to shock given that personal debt is at unheard of levels.

The Bank of England and the government between them have done a good job of keeping inflation in check.

However, the taxpayer has gone around the problem of more disposable income by extending credit on increased property values. This has become a positive feedback mechanism and a response to increased taxation.

There is nothing the government or the Bank of England can do in such circumstances. We are reaching a plateau for credit extension and the banking system is at great risk given the lack of new deposits.

This is a worldwide problem. Is it perhaps a factor in the price of gold per troy ounce reaching 522 dollars? Those with money are better equipped to hang onto it.

I had always assumed that the plan to allow SIPPs to invest in residential property was to counter the dangers of a falling property market. Now that the market has proved to be more resilient than was once feared, and that we are more likely to have a soft landing than a terrible crash, then the Chancellor can revert to his socialist ideals and stop the toffs buying second homes with their pension funds!

This must be the NEW start of GB war against what he calls Tax Avoidance.
I anticipate a year long campaign with harder hitting measures.
I fear the Accounting Profession will be in turmoil by April 07.
Isn't it time the BIG BOYS stand up and be counted and tell GB there is no such thing as Tax Avoidance or are there too many skeletons in the cupboard.

...if many of the comments referred to in the article were not inordinately shrouded in self-interest.

There are mega issues with the insurance, pensions and financial services industry in this country (as one person being quoted has pointed out) long before we get to the enormous problems of politicians, short-termism and spin.

Put the two together and you get exactly what we have - dreadful muddle.

If the State is going to provide some safety net for people, especially in retirement (with issues of health and increasing longevity), it creates by definition enormous structural economic issues - and, I'm afraid, they are problemmatic however strong the social advantage and moral justice arguments are.

Indeed, so great are the problems, that the otherwise unpalatable notion of compulsory saving for retirement seems to be surely inevitable? And in the not so far distant future? - the one thing that surprised me about the Turner report was its (IMHO) relaxed timetable.

As for the folk so saddened by the withdrawal of fee-grabbing schemes for esoteric richmens (and womens) playthings, many of us can hold back the tears. This is where theory and practice do collide, and public perception IS relevant. Some underlying substantive points (about important Govt policy not being thought through and major changes at a whim) are well made and cause enormous practical difficulty. But spare the hystrionics on matters that (on a social and political level, and arguably on an economic level) were wrong ab initio.

Isn't this another example of how our Government is pledged to practice joined-up government but can't put two and two together to make four - and when someone else does they eventually have to retreat? Reducing CT to 0% in the SAME BUDGET you increase NIC to 2% was bound to increase incorporation and they act surprised!

At an early stage when liberalisation was being proposed there was, I seem to remember, a suggestion that the 5% borrowing limit applied to large funds should also apply to SIPPs and SSASs.

Representations were made, I am sure, and so these smaller funds were allowed to borrow 50% of the fund value, and surprise, surprise, someone realised that you could buy a holiday home at a net cost of £60,000 which was actually worth £150,000 by the combination of tax relief and loan.

The Industry may be sad, but I think it was so obvious that they would have to deal with this problem sooner rather than later was self-evident, I was not in the least bit surprised, it is simply the suck it and see approach so often adopted in a department where the minister is simply not interested in the practical workings of the tax system.

SiiP's have historically allowed part residential/part commercial where the residential aspect is ancilliary & minor to the commercial element

Has this now changed because the Chancellor has panicked