Two cheers for changes in Gift Aid confirmation

Charities are reacting cautiously to the Chancellor's announcement last week that they will no longer have to write to telephone donors to confirm they want their contributions to attract Gift Aid.

The reason for the caution is that charities will instead have to keep potentially expensive technological records - digital recordings of telephone calls, emails and text messages - for six years.

These requirements were not detailed by Gordon Brown or the Treasury press notice, but were revealed in a separate announcement yesterday.

A Treasury spokesman said details would have been given last week if the media had asked.

"We can't be held responsible for questions they didn't ask," he said.

"We estimate that charities as a whole will save £1m a year from this initiative."

Brown's announcement received positive coverage, including a lead story in The Times that predicted a "multi-million pound windfall". Some observers suggested the speech was timed to overshadow a Commons briefing tomorrow about public support for the Treasury to compensate charities for the irrecoverable VAT they incur.

The briefing, hosted by Labour MP Tom Levitt and supported by MPs including LibDem Bob Russell and Conservative Tim Yeo, will reveal an opinion poll commissioned by the Charities Tax Reform Group showing "overwhelming" public support for VAT compensation for charities.

David Ramsden, chief operating officer for Children in Need, said the announcement was good news, but his charity would be able to take only "modest steps" towards using the new system in next month's appeal. "I think there will be a full range of responses," he said. "Some will go for electronic data capture; some will stay where they are."

Nick Kavanagh, finance director at Save the Children, said his charity would stay with written confirmations: "The change will probably affect organisations such as Children in Need and the Disasters Emergency Committee more than individual charities."

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