Nigel Green (pictured right), chief executive of deVere Group, claims that this is a rash decision on the part of the Government and constitutes an anti-business measure. "Such a raid wouldn’t only affect those in the super-rich bracket; it would affect owners of enterprises, which are vital for the UK’s economic growth," he said.
"High rates of personal tax are 'anti-business' as they reduce a firm’s capacity to grow, thereby dampening job creation."
"There’s no doubt in my mind that a raid on pensions tax relief for the better-off would be damaging for the British economy. It flies in the face of sensible, modern tax policy."
"It is imperative that the chancellor seeks other ways of boosting the Exchequer’s coffers that don’t hit businesses."
Danny Cox (pictured left), head of advice at Hargreaves Lansdown, agrees with Green and says that the reason pensions are currently unpopular is because of their ever-changing structure. "We have seen too much tampering with them of late," Cox explained.
"We had the implementation of the auto-enrolment scheme and now the last thing we need is a further attack on pensions."
"This is the very reason why investors have tended to avoid holding a pension. There should be no further change to the schemes, in order to give pensions a period of stability."
"A change of annual allowance from £50,000 to £40,000 a year would not have a massive effect on how much tax the HMRC would collect. They should just leave it alone," he added.
Chris Spear (pictured right), managing director of Spear Financial Limited, believes this proposal is another in a long line of measures that has done little to raise the profile of pensions for investors.
"Clearly, this reduction of the tax threshold is not a good idea," he said.
"However, I’ve been in the industry, all told, since 1989 and I have not seen one piece of legislation that has improved the status of pensions." "This makes it harder for investors to put money into their pension and of course they are difficult to take money out of; they are now even less attractive."
"I am pragmatic and I understand why they want to implement this policy, but I am also very negative about it because it does absolutely nothing for pension provision."
Constant changes in regulation are why Spear would recommended investors prioritise an ISA over a pension.
"You can see it growing and it is completely flexible. However, I am struggling to see how pensions will continue to survive," he added.
Jason Hollands (pictured left), managing director of communications at Bestinvest, says that while the proposal is poorly timed, the large amount that people would have to invest to be harmed by the new tax bracket means it is hardly a disaster.
"'So what?', some might argue, £40,000 is still a lot of money to save in any one year." "That is true, but the reality is that many middle-class investors have to play serious catch-up with pensions as they approach retirement, confronted by the reality of how much they need to boost their fund by to generate a decent income."
Hollands believes that pension schemes are still the best long-term investment strategy for saving, and urges investors to jump on to the current lower tax threshold as soon as they can.
"For those currently liable to the 50 per cent rate of income tax, there is an added incentive to utilise a pension this year as this tax rate is set to drop to 45 per cent next April," he explained.
"If a pension fits your investment objectives, and you pay higher rates of tax, then it really does make sense to consider making use of them while such generous reliefs are available and while the very top rates of income tax remain so high."