The Treasury is consulting on whether company shares traded on wider equity markets should be eligible for Isas. It is hoped this would bring in capital for small to medium-sized enterprises and encourage more investment in growing business.
Tony Vine-Lott, director general of the Tax Incentivised Savings Association, said: "We are pleased that the Government wants to consult with a view to allowing Isa investors the choice of backing UK growth companies on AIM. This sends a good message that supporting equity investment in SMEs can be a strong lever to deliver growth and job creation. It can also give investors wider choices when making Isa investment decisions."
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John Williams, managing partner at Kuber Ventures, said: "This is a positive move by the Government to encourage more investment in small businesses. The opportunity for tax efficient investment in the FTSE Aim market has always been available through EIS and VCT, but opening the shares up for investment through the UK's most popular Isa products will give the market a much needed influx of investment which will not only help bolster the index but the British economy as a whole."
However, Mr Williams said investors would need to be cautious as AIM was a complex market.
He said: "Aim is a hugely complex market and has often been described as having a split personality where investors' fortunes have been made and lost in equal measure. Any DIY investors contemplating moving their Isa investments into this space should do so only after careful consideration."

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