Has the UK got coalition fever? Daniel Fletcher considers what influence the recent political happenings have had on civil society and its gift aid potential.

It seems coalitions are the way to go right now, with a renewed campaign from the Institute of Fundraising  for a charity-friendly approach to gift aid. Although I did like the commentator yesterday looking at the ubiquitous photo of Dave and Nick, and asking whether anyone else thought it was like an advert for a slimming product with the ‘before’ and ‘after ‘ images!

Anyway, the sector-wide coalition is aiming to reach agreement in the sector on a way forward, and the main proposal seems to be that the transitional relief on Gift Aid  that was set up to help charities following the drop in income tax rates to 20% should be a little less transitional, and perhaps a little more permanent. It does beg a number of questions about what Big Society will mean for charities. Firstly, of course is the semantic question of whether we are a ‘sector’ anymore, third or otherwise, given that our minister is the minister for Civil Society. Will there now be a ‘civil society-wide’ coalition on gift aid?

A second question relates to Coalition plans for income tax. Although 20% does seem to be a magic number for the coalition when it comes to changing taxes, such as VAT and CGT, will income tax remain at 20% as the going gets tougher? An increase of 2% would put us back where we started, and charities at least would be happier!

Another question on gift aid reform is what to do with higher-rate tax payers? The Coalition (why does that term now seem to have Star Wars-like undertones?) is already in a difficult position due to proposed tax increases hitting their supporters in the middle classes, so what would they want to do with the extra gift aid payment that higher-rate tax payers can currently claim back for themselves?

It’s a good time for the civil society coalition to be asking Nick Hurd and colleagues about Gift Aid, but I do wonder whether there’ll be much progress on this can of worms for quite some time.