TWO major charities have both expressed their disappointment at government plans to cap tax relief on charitable donations.
Both Iain Rennie Grove House Hospice Care (IRGH) and The Hospice of St Francis have said that the plans couldn’t come at a worse time when the economic situation and low government funding mean they are struggling.
Under the controversial plans revealed in last month’s budget generous donors would have to pay tax on funds they give that are more than £50,000, or 25 per cent of their income.
This could be a real headache for IRGH, which is doing everything it can to raise more money to meet with increased demand for its hospice and hospice at home services and offset falling government funds due to inflation.
Spokesman Gemma Baxter said: “Part of our strategy is to seek large donations of this magnitude and the news that giving to charity is now less tax-beneficial will almost certainly have a detrimental effect on these plans.
“We cared for 300 more patients in their own homes last year than in the previous year – an increase of 17 per cent.
“Sadly this growth is predicted to continue so anything that might discourage people from giving – at what is already a very difficult financial time for many people – could greatly impact our ability to deliver care where and when it’s most needed.”
Almost a quarter of IRGH’s annual funds come from personal donations, while only 15 per cent of its annual running costs is paid for by the government. The rest comes from fundraising.
Like The Hospice of St Francis, based in Berkhamsted, it relies on the generosity of members of the public.
The Hospice of St Francis needs to raise £3.7m every year and generates its income through fundraising, legacies, in memory gifts, regular giving, major gifts, trusts and corporate support.
Spokesman Claire De Silva said: “We have been disappointed by the government’s proposal, particularly when their funding for hospices is so poor.
“It is our experience that people wish to give because they’ve seen the magnificent things we’ve been able to do for their friends and family and not because they want to avoid paying tax which is what the cap seems to suggest.”