Dame Stephanie Shirley, the government’s founding Ambassador for Philanthropy, has written an open letter to David Cameron urging him to drop the proposed cap on tax-effective giving.

The letter, which has been widely covered in today’s newspapers, including the front page lead in the Daily Mail, describes the plan as “vague and ill-considered” and declares that it will “undermine the government’s hopes of creating a Big Society”.

Dame Stephanie, who was the first government-appointed Ambassador for Philanthropy in 2009 and 2010, wrote that philanthropists are “deeply dismayed” by the proposals and that many have already informed charities privately of their intention to put on hold plans to give “five, six or even seven-figure sums”.

“It is claimed,” she wrote, “without producing a scrap of evidence, that these measures are essential to prevent tax evasion and fraud. We doubt that.” Instead, she said, they will, if enacted, significantly hamper the work of many charities, large and small, as almost half of all giving comes from just 7 per cent of donors through significant giving.”

She described it as “telling” that the “naïve” proposals have come about without consultation with either philanthropists or charities, and without even discussing them with the ministers responsible for charities and the arts.

The UK should take a lead in creating a financial and legal regime that can maximise giving, she told the PM. Philanthropy is a “promising force for good”, already doing wonderful work within its restrictions, but there are “almost no limits” to what more it could achieve if released from the shackles of red tape and regressive tax laws.

She concluded: “Thus we call on you, Prime Minster, to commit to drop these damaging proposals now and use the forthcoming Giving Summit to draw on the knowledge and commitment of major donors to begin enacting reforms that can unleash the power of philanthropy as a force for good.”

Dame Stephanie is also a co-founder of Ambassadors for Philanthropy and founder of the Shirley Foundation.

The letter comes just a day after Chancellor George Osborne gave an interview to the Daily Telegraph in which he said he had seen anonymised tax returns of 20 of the UK’s richest citizens, who had used various legal tax avoidance measures including charitable giving, to slash their tax bills.  He said this evidence justified the tax relief cap being proposed.