The chief executive of Acevo, Sir Stephen Bubb, has stepped in to defend fee-charging health charities after a private company criticised their tax breaks.

He said: “The tax status of charities rightly reflects their commitment to a mission of public benefit and their not-for-profit status.”

An American company that runs six private hospitals in London, HCA, claimed that the tax relief claimed by charities operating in the private healthcare sector gives them an advantage. HCA wants the Competition Commission to look at the issue in its review of the private healthcare market, due to be published in 2014, and also called for the government to change the tax system.

HCA commissioned a report into the tax reliefs of four charities: Nuffield Health, the London Clinic, the Hospital of St John & Elizabeth, and King Edward VII Sister Agnes.

Bubb added: “HCA’s criticism seems like a transparent attempt to distract from their own issues with the Competition Commission. They should concentrate on their own concerns rather than calling into question the huge contribution made by the NHS charities to improving the health and wellbeing of the population.”

A number of other private healthcare providers have made submissions the Competition Commission’s investigation which raise concerns about HCA’s dominance of the London private healthcare market.

Nuffield defended its charitable status yesterday, saying that: “Everything we do at Nuffield Health is designed to improve the health of the UK population. This means, like every other charity in the UK, we operate under a separate tax regime than global for-profit organisations who exist solely to provide a return to their shareholders.”