The Small Charitable Donations Bill, which will introduce the Gift Aid Small Donations Scheme, has been sent to the House of Lords.
The bill was debated by MPs yesterday as it went through the report stage and had its third reading in the House of Commons.
MPs debated whether the GASDS, which will enable charities to claim Gift Aid-like payments on small donations totalling up to £5,000 a year without individual paperwork, should be reviewed two years after the bill comes into force and no later.
Cathy Jamieson, the Labour MP for Kilmarnock and Loudoun, argued for a government review within two years that would look at detailed data and break down how it was working for different types and sizes of charities.
But Sajid Javid, the Economic Secretary to the Treasury and the minister in charge of the GASDS, said the government had committed to reviewing the scheme after three years.
Jamieson pursued the issue to a vote, but lost.
There was further debate about the matching requirement, which had already been softened in government amendments published on Friday. This changed the ratio so that charities will have to claim £1 in Gift Aid for every £10 claimed under GASDS, rather than £5 for every £10 as previously required in the bill. According to Treasury figures, 16,000 charities will benefit from changes to the matching requirement.
Jamieson and other opposition members had called for the requirement to be scrapped altogether and Nigel Mills, the Conservative MP for Amber Valley, had called for the matching ratio to be reduced to 3:1, but they withdrew their amendments in light of the government’s changes.
"I have no desire to be only a third generous as the Treasury and so I welcome this move by the minister," said Mills.
Javid said a government amendment also introduced a power that allows it to remove the matching requirement entirely.
The government had also amended the bill so that to be eligible to claim under the scheme, charities must have made successful Gift Aid declaration in two out of the previous four tax years, rather than three out of the previous seven.
Eilidh Whiteford, the Scottish National Party MP for Banff and Buchan, was among those who called for the scheme to cover non-cash giving.
"The reality is that technological developments, especially with smartphones and tablets, mean that the number of electronic cashless donation options is growing," she said.
The amendment was not pursued, but Javid said the review in three years would look at whether to extend the scheme to non-cash donations.
After the debate, Sir Stuart Etherington, chief executive of the National Council for Voluntary Organisations, said: "The Treasury has listened to the concerns of our members and the charity sector.
"We have argued for many months that the bill risked excluding the charities that it was intended to benefit.
"These changes will ensure that more charities can benefit from the scheme. As the scheme gets up and running, it will be essential that government markets it effectively to charities and encourages take-up. We will apply further pressure to ensure that it reaches as many charities as possible."