Irrecoverable VAT campaign uses Number 10 petition site
Howard Lake | 1 March 2007 | News
Given how much the UK public can get excited about road pricing, perhaps they can also get equally excited about stopping £400 million of their donations going each year to pay charities’ VAT. Hence the establishment of another petition using the government’s petition website.
Charities have campaigned for years to overturn the irrecoverable VAT that they pay. Indeed, many argue it is a particular problem because the more active a charity is in providing services, the more VAT it is likely to pay.
Local authorities and commercial companies can recover the VAT that they pay, but charities cannot. The Government has recognised the problem but says that it cannot do anything about it because of the cost. As a result, charities continue to pay between £400 and £500 million a year in VAT, money which could otherwise be diverted to charitable activities.
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The petition to the Prime Minister to “to Stop making charities pay VAT” (sic) has been set up by “Damien”. It’s not quite as detailed as those arguments put forward by voluntary sector organisations and umbrella organisations. The petitioner explains: “This is an added expense for groups that are already financially stretched to their limits. Give charities a break. The PM knows how valuable the work of charities are and the pressure they relieve on welfare state services.”
Regrettably it makes no reference to the enormous VAT sums paid by charities or the fact that charities do not enjoy the same benefits as public and private companies in terms of recovering this VAT.
Still, the campaign is getting some coverage in the voluntary sector so one might as well support it in order to exploit any opportunity to address this issue. UK Fundraising’s Howard Lake has added his name to it.
Charity Finance magazine reports that RNIB chief executive Lesley-Anne Alexander and World Emergency Relief’s UK director of operations Alex Haxton were among the first to sign up, and that Helen Donoghue, head of the Charities Tax Reform Group, “has been circulating the email to contacts in the sector and encouraging them to sign”.
The road tax petition accrued 1,791,942 signatures by the time it closed on 20 February 2007. So far the expenditure of nearly half a billion pounds by charities has engaged 2,441 signatories. The petition closes on 21 June 2007.
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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.