20 March 2013
The Chancellor’s Budget proposal to make Gift Aid fit for the 21st century could
help charities gain more than £700m a year, at a time when one in
six charities fear they may face closure during 2013, the Charities
Aid Foundation (CAF) said today.
CAF is delighted that the Chancellor has responded positively to
its long-standing calls for reform and will consult on replacing
the current cumbersome system of Gift Aid.
The Budget document (paragraph 2.75) pledges that “The
Government will consult on proposals to make it easier to claim
Gift Aid through a wide range of digital giving channels, including
options for enabling donors to complete a single Gift Aid
declaration to cover all their donations through a specific
channel.”
CAF has estimated that reform could help bring charities up to
an extra £735 million by increasing public awareness of Gift Aid
and boosting ways of giving such as Direct Debit and via social
media which make it easy for people to ensure tax relief goes to
charities.
A CAF survey of senior charity executives
published last year found that:
- 17% said it was likely that their charity may face closure in
the next 12 months.
- 40% worry that their charity may have to close if the economic
situation does not improve.
- 49% say they have had to use reserves to cover income
shortfalls over the last year.
- 26% say they had cut front-line services.
- 25% say they had made staff cuts.
John Low, Chief Executive of the Charities Aid Foundation, which
promotes charitable giving and provides financial services and
social finance to not-for-profit organisations, said:
“It is excellent news that the Treasury has responded positively
to our long-standing call for a single Gift Aid declaration that
people can use to cover all their charity donations. Such a reform
will make it easier for people to add Gift Aid to all their
donations whether via smartphones, tablet computers or more
traditional methods.
“Gift Aid is vital for charities, but it simply isn’t fit for
purpose in the 21st century. By bringing it up to date, charities
stand to gain hundreds of millions of pounds a year.
“We need this fundamental reform of Gift Aid to make it work for
the millions of people who support the causes we all care
about.”
The Government also announced a commitment to introducing tax
reliefs on social investment (Red Book para 1.135)
John Low commented: “The Chancellor's committment to introducing
a new tax relief to support social investment is very welcome.
“Britain leads the world in using social investment to make a
difference to people’s lives. We need to increase the flow of
investment capital to our pioneering social enterprises so they can
create new ways of working, and innovative solutions to intractable
social problems in Britain today.
“We will work closely with the Treasury to ensure that this
welcome reform of the tax system does indeed deliver the social
impact that innovative social entrepreneurs can create.”
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