Budget it or fudge it?
1 April 2011 | By Cause4 staff
Last week, George Osbourne announced the second budget of his chancellorship, introducing new changes to benefit the charity sector:
”¢ From April 2013, changes to Gift Aid will allow charities to claim Gift Aid on £5,000 worth of donations without the need for signed declarations.
”¢ By April 2012, there is to be a 4% drop in the rate of inheritance tax (to 36%) for those bequeathing 10% of their estate to charity after their death.
”¢ From April 2011, the current limit of £500 is to be increased to £2,500 to enable charities to give ‘thank-you’ acknowledgments to donors.
”¢ A new online system of filing for Gift Aid applications is to be introduced by April 2013 to reduce bureaucratic burdens.
”¢ Further exploration about how to increase take up of Payroll Giving will take place.
”¢ Consultation will take place in 2011 on proposals to encourage donations of pre-eminent works of art or historical objects to the nation in return for a tax reduction.
Without seeking to repeat the plethora of opinion already offered by many commentators, Cause4 offers these thoughts:
It would be churlish not to acknowledge the positive developments announced in the budget. Of course the encouraging of legacy giving is to be welcomed – as are plans whereby charities can claim Gift Aid on multiple smaller donations. However, are we alone if feeling underwhelmed. Far too many further consultations and explorations – not nearly enough in the here and now.
If you had £240m to make available to charities, the sum the Chancellor claims will be given through Gift Aid concessions, would you not choose to spend it incentivising new and more substantial donations? And the idea of enabling charities to say thank you to donors with acknowledgments that might have a value of £2500 as opposed to £500 seems frankly crass! Not only will it cost charities more in time and money but it pre-supposes that this is what donors want and expect. Is it really going to turn hesitant givers into much more substantial ones.
Where are the real tax-breaks? Where are the new radical, creative ideas? Where are the imaginative schemes to enable those that might leave generous legacies to have their gifts advanced? In the eyes of some the Budget announcements might be the best ever for charities, but to suggest that these new measures will turn philanthropy on its head seems little delusional.