After weeks of controversy, Osborne has decided to scrap the cap on tax deductions for charitable giving last Thursday. Here’s a taste of what people are saying.
From Nonprofit Quarterly:
The proposal of Chancellor of the Exchequer George Osborne to include charitable donations in a cap on tax relief, like President Obama’s proposal to cap charitable deductions along with mortgage interest and local and state tax deductions for the wealthy, has had a rough go of it, getting savaged by nonprofits and from the governing parties’ own back benchers.
The proposal engendered such widespread opposition that Osborne reversed himself and dropped the cap because, he said, it could have “potentially damaged” charitable giving. The government’s reversal will cost the budget 10 million pounds, which, along with other 180s that the government has made on tax issues in recent days, has turned the Cameron government’s austerity plans into what a Labour Party spokesperson called an “embarrassing shambles.”
From the Daily Mail:
George Osborne has been accused of ‘taking his eye off the ball’ as he ditched plans to tax charitable donations by the wealthy in his fourth Budget U-turn in two months.
The Chancellor said philanthropic giving is to be excluded altogether from a new cap on tax relief in a move costing the Treasury between £50million and £100million a year.
The retreat follows others on the so-called pasty tax, caravan tax and heritage tax since Mr Osborne’s badly-received Budget in March. Over five years, all the changes will cost the Treasury a maximum of £750million.
From the Independent:
Charities, universities, medical research centres and arts organisations had joined forces with MPs from all parties to condemn plans to limit tax relief on gifts to good causes to £50,000 or 25 per cent of income. They protested that the cap would have a devastating impact on donations from philanthropists, undermining David Cameron’s commitment to the “big society”.
The retreat was announced as Jeremy Hunt, the Culture Secretary, came under pressure at the Leveson inquiry over his links to News Corporation.