Firms representing millions of savers have lined up to warn Rachel Reeves about the damaging consequences of a raid on pension contributions.

The Chancellor is widely thought to be considering a cut to income tax relief on retirement savings for top-rate taxpayers.

That could end up affecting nearly 9 million workers as more and more employees are dragged into paying tax at the 40 per cent rate over the next few years.

Pension firms, including Standard Life, warned that it could deter employees from putting aside enough money for their retirement. 

Workers paying into pension savings receive tax relief on those payments – at 20 per cent for basic rate taxpayers and an additional 20 per cent if they pay tax at the higher 40 per cent rate.

But there are fears that Labour could limit tax relief for those in the 40 per cent bracket as Reeves looks to shore up the public finances. 

And some are also concerned about other potential pension reforms, which could include reductions in the lump sums that can be taken out tax-free, or making pensions subject to inheritance tax. 

Mike Ambery, retirement savings director at Standard Life, said: 'A flat rate of pension tax relief will increase complexity into the pension system and have a lasting impact on people's future retirement, so it's important that decisions are made with a long-term view rather than focus on near-term fiscal challenges.'

Steven Cameron, director of pensions at insurer Aegon, said: 'While it may be tempting to the Chancellor to boost tax revenues by reducing such incentives, doing so could have far-reaching adverse consequences if they discourage people from doing the right thing and saving for their own retirement rather than relying on the state.' 

Lynda Whitney, senior partner at Aon, said: 'Pensions are a long-term product where trust in the structure is vital.

'Changes for short-term budgetary reasons could erode that trust – particularly if the Treasury makes what feels like retrospective changes to pensions taxation of retirement lump sums or inheritance of pension rules.'

Steve Watson, director of policy & research at NatWest Cushon, said: 'Any potential change in the pension equation needs to be part of a long-term view. We've seen how tinkering around the edges can lead to an imbalanced system.'

Tess Page, UK wealth strategy partner at Mercer, said: 'We already know people are not saving enough for their retirement.'

Jamie Fiveash, boss of Smart UK, said: 'The tax changes rumoured have the potential to move us in the wrong direction.'