ISA sales reach highest ever level after increase in personal allowances

ISA sales more than doubled in the last year rising to a record figure of £400m a month taking the total sales figure to £14.6bn for the year, the Investment Management Association (IMA) said yesterday.

The figures showed ISA sales had reached their highest level since they were launched in 1999 as savers showed a renewed enthusiasm for investing in stocks and shares ISAs in particular.

The IMA said this was largely as a result of the increase in the annual tax free personal allowance from £7,200 to £10,200.

Meanwhile, an IMA survey of over 2,000 savers found almost half (47 per cent) of savers would invest more into an ISA if the annual allowance was increased further.

Just over a third of savers (36 per cent) said they would invest more if long term savings incentives remained consistent, while 44 per cent said they would invest more if there was a lifetime tax-free ISA allowance.

The findings could cause a headache for the government which is believed to be considering lowering the personal allowance. Labour MP? and Treasury Select Committee member, Andy Love, suggested at a fringe event at the Labour party conference last week that the coalition government was considering the move as part of the comprehensive spending review due in a fortnight