Editorial: No excuses over Gift Aid reform

A lack of consensus in the voluntary sector is no reason for the Treasury to stall, writes Stephen Cook

Stephen Cook, editor, Third Sector
Stephen Cook, editor, Third Sector

The reform of Gift Aid has come to rather resemble the Tower of Babel in recent months - everyone speaking a different language and the construction of the edifice grinding to a halt.

Even the proposal that brings most consensus - changing from an opt-in system to an opt-out system - has attracted discouraging noises: some people have reservations that it might increase bureaucracy because - in the absence of a declaration by donors - officials would have to check if they were taxpayers or not.

Then there is the question of what should happen in respect of higher-rate taxpayers, who at the moment can claim part of the tax rebate themselves.

Some in the sector want the full rebate to be given to charities; others worry that this would remove an important incentive for higher-rate taxpayers to give more.

The debate is made more complex by the fact that you need to be a professor of mathematics to understand the figures, and there is also chaff from the Treasury: the latest rumour is that Gift Aid might be removed altogether for higher-rate taxpayers, possibly in favour of a composite level of relief designed to simplify administration.

But perhaps the most grating aspect of Gift Aid is the smile on Westminster and Whitehall faces as they point out with feigned sadness that the take-up of Gift Aid remains lower than it could be and that it would all be easier if the sector could only agree on what it wanted.

That's just an excuse, and it doesn't really wash. The rate of take-up is in part the result of an excessively complex and demanding system, and the absence of consensus is one sign of how unfit for purpose it has become.

There is, thankfully, political commitment to reform, and surely it's the job of the Treasury - not the voluntary sector - to work out something better.

Ministers have indicated that all could be revealed in next month's pre-Budget report, so everyone can look forward to that.

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