Editorial: Ten questions, one answer - you decide

It took three weeks for the Treasury to respond to the ten questions Third Sector put to it on the subject of reform of VAT for charities.

When the response came, it consisted of a 500-word statement rather than specific answers to the questions. Both the questions and the statement are reproduced on page 5 - we would be interested to hear the views of readers, so you can email them to thirdsector @haynet.com.

When the Treasury response arrived, we queried why there were no specific answers, but were assured the answers were contained within the statement. For example, the first question - how the Treasury intends to pursue the Government's manifesto commitment on the voluntary sector - was said to be answered in the second paragraph. Close examination reveals this is actually about what the Treasury has done for the sector in the past - if it is an answer, it's an answer to a different question.

But hey, this is Whitehall - a part of the forest where the direct answer is a relatively rare flower. You can, in fact, discern a fairly clear response to the question about giving care-providing charities comparable VAT relief to local authorities - the third paragraph can be roughly translated as "no". Otherwise, this is essentially a holding statement, written in fluent mandarinese, for use while the issue is being processed for consideration by ministers in due course.

What ministers will make of it is hard to predict. It seems clear from the statement that department officials will try to steer them towards saying that, one way or the other, the sector has had a good deal on taxation and it's now time to stop moaning and be thankful. But it would leave everyone struggling with a system that even Treasury officials are known to dislike - a patchwork of measures, without firm guiding principles, that is constantly being tweaked and reinterpreted by officials, crawled over by tribunals and courts and reinterpreted again.

In the end, the key fact with ministers is likely to be the political pressure for change. In the coming months, the Charities' Tax Reform Group and others will be focusing on building up that pressure by persuasive campaigning within and outside Parliament. There are encouraging signs that people with real influence are coming on board. And when the subject eventually comes up on the ministerial radar, it will be the time for the big push.

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