Thursday 22 March 2012

Uncharitable behaviour from George Osborne

Budget Day is never an occasion to celebrate, but yesterday's announcement from Chancellor and unlikable swot George Osborne is likely to leave charities feeling more than a little hard done by.

His plans to cap personal tax relief at £50,000 might seem like a good idea in an era of loopholes and avoidance schemes. But the Charities Aid Foundation, who deal with finance for the voluntary sector, has warned that it will lead to a major drop in philanthropic donations from high earners. John Low, the head of the foundation, points out that charitable donations are not tax avoidance, saying of personal tax relief:

"It is supporting major donations by people who, in some cases, are donating the proceeds of a lifetime's work to charity. Such a change risks reducing major donations by Britain's richest individuals at a time when charity budgets are being squeezed."

The figures would seem to suggest this is already happening. Figures filed with the Charities Commission show a 2% drop in revenue from last year.

Should we be surprised that Osborne is shooting a hole in a central tenet of Tory thinking; the trickledown economy, enabling the rich to bolster the economy through increased spending?

No, not really. This is just another example of the Government's inability to show joined up thinking on the so-called "big society". Pushing charities to take a greater role in social care while at the same time hamstringing their ability to do so is something we've seen time and again from the Cameron administration. As ever, it's those most in need that feel the pinch.

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