NS&I to offer new savings bond, HM Treasury says – Rishi Sunak calls move ‘world first’

NS&I to offer new savings bond, HM Treasury says – Rishi Sunak calls move ‘world first’

The UK will launch the world’s first sovereign green savings bond for retail investors, allowing savers to help drive the country’s transition to net zero by 2050, the Chancellor is expected to announce at Budget next week. HM Treasury said last night the green savings bond will be offered through NS&I.

The Government said it means that via the bonds they buy, the savers will be contributing towards projects that will accelerate the transition to a low carbon economy, create green jobs, and support the collective effort to tackle the climate crisis, whilst saving money at the same time.

These new green savings bonds will be offered through the Government-backed savings provider NS&I.

Money raised via the bonds will be earmarked for projects such as renewable energy and clean transportation that will help the UK “build back greener” and meet its target to cut greenhouse gas emissions to net zero by 2050, the Treasury said.

Further details are to be set out in the coming months.

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However, the Treasury did say the product will go on sale later in 2021.

The Chancellor will deliver the Spring Budget on Wednesday.

It’s not known what he will announce, however there has been plenty of speculation regarding potential tax changes.

The suggestions come as experts have considered how Mr Sunak pay plan to cover the unprecedented levels of public spending due to the coronavirus pandemic.

Ahead of the announcement, Kevin Sefton from personal tax app untied has set out what he thinks will be tackled in this year’s Budget.

“The Chancellor Rishi Sunak faces a difficult dilemma at the beginning of March for his Budget,” he said.

“On the one hand he has a bill of at least £300billion from Coronavirus support measures to pay for, on the other he doesn’t want to break the Conservatives’ 2019 election manifesto promise not to increase income tax, national insurance or VAT rates.

“Despite the fragile state of our economy, and the fact that we are unlikely to see significant tax increases, we do believe there are key focus areas where there may well be movement.

“These will be centred around the COVID-19 response, general rate driven decisions (main areas of change are likely to be around corporation and capital gains tax), tax system changes and ‘hidden’ taxes.”

“One thing that non-PAYE workers need to watch out for is a potential increase on national insurance contributions for the self-employed and possible new measures aimed at company directors.

“When he introduced the self-employed income support scheme, back in March 2020, the Chancellor said: ‘It is now much harder to justify the inconsistent contributions between people of different employment statuses. If we all want to benefit equally from state support, we must all pay in equally in future.’

“This potentially signals a desire to do something about the perceived disparity between national insurance rates, or dividend tax rates, between the self-employed, company directors and those who are employed under PAYE.

“The Chancellor might use this budget as an opportunity to attempt to address this, perhaps at the same time as extending SEISS support to some of those groups who have previously been excluded.”

Published at Sun, 28 Feb 2021 07:18:00 +0000