The cuts Reeves could make to cash ISAs - and what they'd mean for your tax bill

Rachel Reeves is reportedly considering slashing the cash ISA to £12,000 – a slightly less dramatic cut than has previously been suggested.

The Treasury has been floating privately the idea of a cut to £12,000, down from the existing £20,000 limit but higher than the £10,000 suggested befiore, people familiar with the plans told the Financial Times .

Sources have confirmed to The i Paper that this is true, although it is still not set in stone and the Chancellor could opt for a larger cut in the autumn Budget.

Her hope is that reducing the allowance could push more people towards investing in the stock market through a stocks and shares ISA instead.

ISAs allow savers and investors to shield their interest or gains from tax – and they can put £20,000 into them a year currently,