A drive to increase take-up of Gift Aid among smaller charities, relief from VAT on fuel for air ambulances and inland water rescue charities, and the setting of the rate for social investment tax relief at 30 per cent were among the voluntary sector announcements made in today’s Budget.
The main Budget document, published alongside Chancellor George Osborne’s speech in parliament today, says that the government will "encourage more donors to use Gift Aid on eligible donations and encourage smaller charities to register for the reliefs they are entitled to".
It says that this will include "targeted outreach work", a simpler joint application process between HM Revenue & Customs and the Charity Commission, and "improved understanding of donor behaviour".
Responding to the Gift Aid announcement, John Low, chief executive of the Charities Aid Foundation, said he was pleased that the government was committed to modernising Gift Aid but seeing the detail was a matter of urgency.
"Changes must be far-sighted and ambitious, so that Gift Aid is truly fit for the digital age and charities can benefit from this generous tax relief on millions of text, online and mobile donations," he said.
Karl Wilding, director of public policy at the National Council for Voluntary Organisations, said he was pleased that smaller charities would be helped to receive the reliefs they are entitled to.
"Gift Aid is an important relief, so it is reassuring the government is taking the necessary time to think through the consequence of any changes through further consultation," he said.
Daniel Fluskey, head of policy and research at the Institute of Fundraising, said the introduction of targeted outreach work could help to get more charities involved in using Gift Aid.
The document promises that the government will review the benefits allowed to donors, with a view to simplifying existing rules.
Osborne said the organisations that would receive funds paid as fines after the Libor rate-rigging scandal would be extended to include search and rescue and lifeboat services.
Other measures announced today included an increase from £30m to £40m in the budget for the Cultural Gift Scheme, which allows the giving of pre-eminent objects, or items associated with historic buildings, in return for tax relief.
The scheme shares a budget with the Acceptance in Lieu Scheme, which allows people to offer items of cultural and historic importance in full or part payment of their inheritance tax.
Osborne announced an increase in the personal tax allowance from £10,000 to £10,500, which will reduce the number of people who are eligible to claim Gift Aid on charitable donations.
Osborne said the government had increased the personal allowance from £6,500 in the past four years, "lifting more than three million of the lowest-paid out of income tax altogether".