Most charities don't care about tax relief cap, argues Nick Hurd

Minister for Civil Society says most people will understand that the principle put forward by the Treasury is right

The Treasury
The Treasury

Most charities do not care about a new cap on tax relief for major philanthropists and expect it to have little effect on them, according to Nick Hurd, the Minister for Civil Society.

At a press conference before today’s Giving Summit, the meeting between charities, officials and donors that is intended to find ways to encourage philanthropy, Hurd said he was confident there would be an effective resolution to the current argument between sector bodies and the government over the proposed cap on tax relief.

The cap, proposed in the Budget, will mean that donors can claim tax back only on donations of £50,000 or a quarter of their income, whichever is higher, from April 2013.

"For the vast majority of the sector, although they may be enjoying the opportunity to duff up the government, it doesn’t have that much impact on their day," said Hurd.

He said he had recently visited a number of small charities in Birmingham and he did not believe that the cap would have a major impact on such organisations.

He said the Treasury was now gathering evidence to make sure it made the right decision and to ensure that the introduction of the new tax relief would not have a negative impact on charities.

"I have a strong sense they are going to get this right," he said. "I think they won’t rush into a knee-jerk reaction, but I don’t think anyone wants this to go on forever."

But he said he felt that major givers would accept that the principles behind the cap were correct.

"I think we have some bridge-building to do with philanthropists," he said. "I think some people are feeling bruised out there.

"But I think in their heart of hearts, most people will accept that the principle George Osborne is asserting is hard to argue against. Once this is resolved, we’ll be able to move on."

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