Children's charities welcome U-turn on tax relief plans
Janaki Mahadevan
Friday, June 1, 2012
Children and young people's charities have welcomed the government's decision to reverse its cap on tax relief for charitable donations first announced in the Budget in March.
The cap would have limited tax relief to £50,000 or 25 per cent of income – whichever was higher – and was expected to save the Treasury £50m to £80m a year.
But the Chancellor backed down on the plans this week, following fierce opposition from the Give It Back campaign backed by more than 1,000 voluntary organisations including the YMCA, volunteering charity V, Warwickshire Association of Youth Clubs and Cheshire Children, Young People and Families.
YMCA England chief executive Ian Green said: “The government announced the so-called charity tax in its budget without fully recognising the potential impact upon the charity sector.
“We welcome the U-turn and are pleased that the government has listened to the strong representations made by charities and decided not to proceed.
“The government got itself into this mess because it did not fully talk to and work with the charity sector before announcing its proposals. We hope that the government have learnt from this and will approach things differently in the future.”
Susanne Rauprich, chief executive of the National Council for Voluntary Youth Services, said: “The cap on personal tax relief could have negatively impacted on major donations to charities. Support for our charities in the current climate needs to be encouraged by the taxation system, not strangled.
“NCVYS was pleased to support the Give It Back campaign. The move demonstrates the power of charities to effect change through collaboration on cross cutting issues. In the present climate we all need to be doing this more.”
Daniela Barone Soares, chief executive of venture philanthropy organisation the Impetus Trust, said the climate of public sector cuts has made charitable donations all the more important.
“Voluntary organisations of every size mobilised against this measure because it was clearly wrong-headed,” she said.
“Now more than ever charities need to increase their capacity to tackle difficult social issues, especially given the increasing need in an environment of funding cuts.”
