Plans to cut tax-free allowance on hold after backlash

The chancellor has shelved any immediate plans to make changes to cash Individual Savings Accounts (Isas), the BBC understands.

Savers can put up to £20,000 a year in Isas in savings and investments, to protect the returns from being taxed.

But Rachel Reeves was thought to be considering reducing the allowance for tax-free cash savings, in a bid to encourage people to put money into stocks and shares instead and boost the economy.

But strong opposition from banks, building societies and consumer campaigners mean any such move has been put on hold.

The Building Societies Association said it welcomed the Treasury stepping back from making any “hasty decisions” on Isas.

However, changes have not been completely ruled out in the future.

In the short term, the government still wants to encourage more investment in stocks and shares, but without altering the rules on cash Isas.

“Our ambition…