Charities lose 10% payroll giving supplement

Howard Lake | 17 March 2004 | News

Charities Aid Foundation (CAF) has expressed disappointment at the Chancellor’s decision to end the 10% tax relief supplement on all company payroll giving donations.

The decision was not unexpected. The boost, launched in April 2000, was only planned to run for three years, so the sector was fortunate that it was extended by a further 12 months in 2003. It was only ever intended as a boost to promote payroll giving and not as a permanent government hand-out.

Nevertheless, what the government took with one hand it gave with another, and CAF offered a cautious welcome to the announcement that the government would extend cash incentives to small and medium-sized companies to take up the scheme.

Since the tax boost was launched in April 2000, payroll giving has seen considerable growth: in just four years the number of companies offering payroll giving has doubled, with over five million employees now able to donate to charity, tax-free from their pay.

According to Stephen Ainger, CAF’s Chief Executive: “The 10% supplement has had a dramatic impact on employee giving over the last few years with donations growing from
£37 million in 2000 to £86 million in 2003. What is particularly disappointing about the announcement is that the scheme’s success has come at a relatively low cost to Government.”

NCVO was equally cautious in its response. It was “concerned that this scheme does not appear to have been subject to any consultation with the sector”. The umbrella organisations aid that it “will be seeking reassurances from the Government that there will be adequate monitoring and assessment of the scheme’s effectiveness at driving up payroll giving.”

About Howard Lake
Howard Lake is consultant editor of UK Fundraising. He founded the site in 1994 and successfully sold it in 2022. As director of Giving X Ltd he is exploring growing giving on a massive scale. He is the founder of Fundraising Camp and co-founder of GoodJobs.