Beth Breeze: The tax cap U-turn has not repaired the damage to philanthropy

The government's change of heart is welcome, says our columnist, but philanthopy has been associated with tax dodging - and mud sticks

Beth Breeze
Beth Breeze

In the midst of the recent charity tax cap debacle, I was interviewing a very rich and generous person for my annual study of ‘million-pound donors’. Inevitably, conversation turned to the ‘Budget Bombshell’. But rather than dwelling on the financial implications of the measure, my interviewee was far more concerned with the rhetorical aspect. She was deeply hurt by the careless equation of philanthropy with tax avoidance and puzzled by claims that the charity sector was awash with dubious organisations. She joked that, if invited to events attended by government ministers, she would wear a large badge proclaiming "I am a tax dodger".

Getting this proposal dropped was a huge achievement for the sector. It was unfair, unworkable, uninformed by evidence and opposed by a coalition of donors, charities and public opinion. Yet amidst celebrations at the success of the Give it Back, George campaign, we need to remember that the U-turn covers only the potential fiscal ramifications, not the rhetorical ones. The damage to the standing of philanthropy is not undone so easily. Mud sticks, and our biggest donors are acutely aware that philanthropy remains contentious. The title of ‘philanthropist’ should be worn as a badge of honour, not as a jokey badge of pseudo-shame.

The problem with philanthropy’s public image is a result of our society’s long-standing unease about money. Wealth creation is more problematic here than in the US. Brits are more troubled by the possession of large-scale wealth, and our confusion about the proper status of, and role for, the wealthy seems to be exacerbated, even if they decide to give some wealth away. A few years ago I did a study of UK media coverage of philanthropy and philanthropists, and found a substantial seam of relentlessly negative caricaturing of major donors.

Philanthropists have long been considered fair game, so it is unsurprising that the government hoped a cap on tax relief for the richest givers would strike a populist chord. It counts as some sort of progress that there was such a widespread backlash and a belief that this measure affected "the wrong kind of rich people", to use the Labour leader’s words. The fact that George Osborne eventually had to ‘give it back’ is good news in itself, but also hints at further good news for the rehabilitation of philanthropy.

Beth Breeze is a researcher at the Centre for Philanthropy, Humanitarianism and Social Justice at the University of Kent

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