Charities call for changes to tax rules
30 Dec 08
Recession affecting donations as demand for services rises
The Scottish Council for Voluntary Organisations (SCVO) has called for changes to tax law to help charities cope with the current economic situation.
Mark Ballard from the SCVO said many charities were feeling the pinch because of the drop in donations and an increase in the demand for their services. In the next few months, he added, many would be anticipating further income problems because of anticipated drops in donations from corporate sponsors such as the banks.
The Charity Commission, which regulates charities in England & Wales, has released data which indicate that a quarter of its organisations have experienced a drop in donations. These include charities that operate across the UK.
Mr Ballard said banks being bailed out by the taxpayer needed to continue to recognise their social responsibilities.
Jasmine Whitbread, the chief executive of Save the Children, said changes to current Treasury rules would help UK charities at this time. She called for the Treasury to exempt charities from VAT and change the rules of Gift Aid, making it opt out rather than opt in. This, she said, could benefit charities by £500 million a year.
The Office of the Scottish Charity Regulator said it was working with the Scottish Government to look at different ways of helping charities. However the Government maintains that it would be too complex to introduce a charity exemption from VAT. Further reforms to Gift Aid are being explored.