Thursday, 12 April 2012

FakeCharity attempts The New Maths. Chaos ensues.

A reader's letter from today's Evening Standard:

If the Government has a problem with tax evasion through charities, the charity sector would be entirely supportive of the necessary regulation to dispel any taint attaching to donors.(1) but we asked the Treasury for examples of how people evade tax through abuse of charitable donations and it has refused to give any.(2)

The 57 community foundations(3) that fund small local charities and voluntary groups across the UK stand to lose around 20 per cent of their donations if this measure goes through, and we estimate that if you add together those who would be discouraged from becoming donors, the charitable sector would be £1 billion worse off, while the HMRC would gain only £200 million.(4)

You have to ask what's better for Britain.(5)

Matthew Bowcock, Community Foundation Network.(6)

1) Ah yes, they'd love that, wouldn't they? The Righteous getting to decide which other charities are Righteous enough - see (6).

2) Why should it?

3) What's a "community foundation"? I'll get to that.

4) There's a missing £800 million there, isn't there? That's the money that would simply stay in taxpayers' pockets, if they want to give a smaller amount to a genuine charity without tax relief then people are free to do so, it is only donations to front organisations which would be significantly affected. And actually, his maths is crap. If 40% taxpayers give £1 billion gross less to charities, then HMRC would end up £400 million better off, because the charities only get half the tax relief and the taxpayer keeps the rest.

5) Yes, that's what I'm doing. And there's no such place as "Britain".

6) Ah... The Community Foundation Network. It runs the Fair Share Trust, which is funded by The Big Lottery, i.e. the government and Local Giving which vets local charities to see whether they are Righteous enough, sort of like a self-appointed Charity Commission but with even less democratic accountability... see (1).

Now, for the money shot, it got £6.7 million in "donations and grants" and Note 3a tells us that £6.1 million of that was from Comic Relief, with another £283,000 from The Big Lottery Fund and £210,000 from The Office of the Third Sector. So it's all government/official funding, if you count the BBC as part of the government, which I do.

Or to put it another way, The Community Foundation Network gets practically no donations from the general public, or at least not directly.


Sackerson said...

Does the cap apply to donations to political parties?

Graeme said...

the idea of giving money to institutions that do the things I enjoy or want to support - let's call them charities - such as supporting orphans, classical music, unusual artistic events, battered housewives, is something I do. I really resent the extra layer of fake charities that get in the way and tell me where to send my money.

Mark Wadsworth said...

S, donations to political parties aren't tax deductible (the only exemption that exists is a limited exemption for Inheritance Tax).

G, exactly. And hopefully you'd still do it without the tax breaks.

TheFatBigot said...

"... it's all government/official funding, if you count the BBC as part of the government ..."

I don't think you need to count the BBC as part of the government. Comic Relief is a charity and has a board of righteous lefties who decide how to waste the money they collect. In that it is similar to the BBC without actually being the BBC.

There really is something quite sickening about Comic Relief. It raising millions from people by saying their donations will go to relieve desperate poverty, scrawny brown children with flies around their noses are paraded to maximise the emotional impact. In fact their website says they "spend that money in the best possible way to tackle the root causes of poverty and social injustice".

Ho hum. "Social injustice". Also known as an an absence of socialism. No doubt a lot of good does come from some of the cash doled out by Comic Relief and some scrawny brown babies are ridded of their scrawniness and of the flies they previously hosted. But for so long as they include tackling "social injustice" in their aims they will throw money at groups and individuals who achieve nothing substantive. It drives me nuts.

Sackerson said...

Sorry Mark, I was thinking about IHT - but didn't know there was a limit now?

Mark Wadsworth said...

TFB, I count omic Relief as part of BBC an BBC as part of the government.

S, donations or bequests to political parties are IHT exempt if the party has two or more MPs at Westminster. So the exemption is no good to small parties.

Bayard said...

Graeme, the Buddhists believe, AFAIK, that the benefit to you from charitable giving comes from the act of giving. What the recipient does with your gift is their own karma. However, when I give money, I want it to go to a charity that I know does some good, not to some bloody middleman organisation, which is why I never give to chuggers, telechuggers or anything like Comic Relief.
What is the point of Comic Relief, FFS, apart from being a vehicle for acquiring Buddhist merit? If you want to give money to a charity there are thousands out there, easily discoverable via the internet, that will take your money directly.
3) above: Hurrah! why not deprive them of 100% of their funding and close them down altogether? That way the charities at the end of the line will see their incomes increase by the cost of the useless middlemen who have been abolished, more than making up for the loss in tax breaks. When a parish council is able to get money directly from the Lottery, there is absolutely no excuse for these organisations to exist.

Lola said...

All of the foregoing. It's just officially sanctioned extortion to enable smug gits to play at being 'charitable' at no cost to themselves.