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The sector’s victory: Charity tax relief cap u-turn 3

Fundraising | Celina Ribeiro | 31 May 2012

In the face of a united charity sector opposing the government’s cap on tax relief for donations, the Chancellor has backed down. Well done, team, says Celina Ribeiro.

You know, there were never any real, hard facts about just how much the government’s proposed limit on how much higher-rate taxpayers can claim relief on their donations was going to cost charities.

Oh, there were figures floating around. Some said £1bn, some said tens of millions, but many charities quietly mused that it would barely affect them at all. No one, not the government nor anyone from the charity sector, could come up with concrete evidence regarding the harm to the sector nor the alleged windfall to the government.

However today, coincidentally just as Culture Secretary Jeremy Hunt faces the Leveson Inquiry to answer questions about his involvement with News Corporation and the company’s BSkyB bid, the good Chancellor drops a bombshell. A beautiful charity sector bombshell which explodes to release daisies, bunnies and hundreds of happy charity umbrella body lobbyists.

The tax relief cap is no more. Now charities can really put their feet up over the Jubilee long weekend.

Earlier this year I wrote about how impressed I was with the speed and the unity of the sector’s response to the tax relief cap, announced in the March Budget. Within days usually warring umbrella bodies united behind a simple message: ‘Give it Back George’. And by George, he’s given it back.

Who would have thought the sector could achieve such a spectacular ministerial about-face when it rallied together?

And so it’s time for self-congratulation. Well done the sector for managing to speak with one voice, so forcefully and so consistently. Well done for sticking with it when some commentators, as recently as this morning, declared a U-turn impossible.

The government should also be commended for its U-turn. There is a long list of U-turns attributed to this government. Doing an about-face on this is evidence that the Treasury had not through the implications of this, despite their avowed commitment to not allowing the wealthy to be their own chancellors of the exchequer, not their quickly-dismissed claims about the masses of ‘dodgy’ charities into which tax dodgers were funnelling bogus donations. But backtracking on this is also a sign that the government has listened, and that it is willing to step away from bad policy decisions, and for that they also should be given credit.

A victory. A resounding victory for the sector, yes. But a victory for the causes, for the work on the ground. For the museums which will be able to pay salaries, for the women who will have a place to kip when trying to escape violence, for the cancer sufferer given new hope by a ground-breaking treatment. Charities, take credit, take the donations and put them to work.

This is the sector’s victory, yes. But charities are merely the vehicle. It’s a victory for the belief in the right and importance of people to help other people.