Rachel Reeves unlikely to cut pension tax relief for higher earners, says report

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.UK chancellor Rachel Reeves is unlikely to cut pension tax relief for higher earners in her Budget next month because it would hit teachers, doctors and other better paid public sector workers, according to a report released on Monday.Reeves had argued as an opposition MP for a flat rate of pension tax relief — a move that would significantly boost Treasury coffers — but a report by pensions consultancy LCP argues she will shy away from this move.Sir Steve Webb, a respected former Liberal Democrat pensions minister and now an LCP partner, said cutting higher rate pension tax relief would hit a significant group of “mid-ranking and senior public sector workers — a group which the government is unlikely to want to alienate”.The LCP report said that Reeves was likely to be taking a keen interest in pension tax relief — with a net annual cost…