The chancellor's introduction of higher taxes on big earners' pensions has been criticised in a report by the House of Lords Economic Affairs Committee as having wider implications that could hit the economy. The ACCA said that the new rate will hamper both small and large businesses which in turn will 'affect UK competitiveness' and thus is 'unlikely to benefit the economy'. A spokesperson for the ACCA said: 'The smaller companies often use their own pension schemes as a source of investmentlarge pension funds invest heavily in the stock market and this investment will inevitably be suppressedthe extra compliance would be unlikely to benefit either the economy or our members as business owners may decide not to bother'. Alistair Darling's changes to tax rates will be implemented in 2011 and those who earn £150,000 plus will be hit on three counts; tax relief on company pensions will be cut from 40% to 20%, a 50p tax will be in place and a 30% tax rate on company contributions into the pension fund will start. The report said: 'Careful consideration will be needed to avoid exceptionally high marginal rates'. It also reveals conflicting views that the new rates will have little impact on UK competitiveness as it only hits a maximum of 230,000 people. The report advises that the 'government should complete consultation well before implementation in 2011'.