Scottish arts face loss of funds

Millions of pounds of charitable donations could be diverted from Scotland's museums and art galleries to those in England and Wales as new charity law in Scotland threatens to strip a dozen public bodies of charitable status.

National Museums of Scotland issued the warning after publication of the Charities and Trustee Investment (Scotland) Bill, which should be ratified by the summer. The Bill includes a charity test that states organisations must be exclusively charitable.

Because the likes of National Museums of Scotland, Scottish Natural Heritage and Sport Scotland are non-departmental government bodies under state control, they fail to qualify. In contrast, national cultural institutions in England and Wales will retain charitable status in the Charities Act.

National Museums of Scotland claims the move will cost millions of pounds in donations and tax breaks and jeopardise a £45m scheme to improve Edinburgh's Royal Museum.

"In the longer term, this will affect the attractiveness of Scotland as a tourist destination and as a major business centre in Europe," the museums group said in its written response to the Scottish Parliament finance committee.

SCVO spokesman Leon Thomson supported the legislation. "Quangos can't be charities because charities need to be free to act independently," he said.

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