There must be something I'm missing here.

If you've got a stocks and shares ISA and you keep a few pounds, or even tens of pounds, in cash, perhaps from recent dividends, perhaps so that fees can be paid without selling anything, then you'll get a few pence interest each month.

And the ISA provider will have to write new systems to pay a penny or two of that to HMRC. And HMRC has to write new systems to accept these odd pennies.

The whole costing, surely to goodness, several times what it will raise in this "charge" (which isn't a "tax").

What am I missing? Or is it really as bonkers as it sounds?

https://www.gov.uk/government/publications/fiscal-events-2026-factsheets/isa-reform-2027-anti-circumvention-rules-factsheet