The Chancellor’s decision this morning to ditch the plan to impose a cap on tax relief for major donors was the government’s third U-turn in a week – the fourth, if you count the pasty tax and the static caravan tax as separate items. It came as a surprise to me – in fact, I blogged this morning to say I thought it unlikely (though not impossible). I thought the government was going to tough this one out, at least until after the summer’s consultation.
My view was that the government, in political terms, was not going to be able to stomach any more humble pie, especially when it had some support – including some from inside the sector – for the principle of what it was trying to do – ‘first pay your taxes, then give to charity’. And only yesterday Labour was rubbing salt in David Cameron’s wounds by listing the 32 U-turns of his administration so far.
But it seems the government has lost its political compass to the extent that it no longer cares about self-inflicted wounds. Maybe the thinking is that if you’ve got half a dozen bullet holes in each foot, one or two more might not hurt – and maybe the coming excitements of the Jubilympics will take people’s minds elsewhere and help with the healing process. This administration seems to be all at sea, and it’s hard to know what’s going through the minds of its captains and admirals.
From the sector’s point of view, this is a great success for the concerted and effective Give it Back, George campaign. A lot of work has gone on both in public and behind the scenes, and it shows what can be done when all the big guns work together.
But there remains the mystery of HMRC’s research into tax avoidance and the mutterings we heard from No 10 at one point about ‘charities that don’t do much charitable work.’ Maybe they don’t really have much evidence. Maybe they’re unwilling the publish such evidence as they have because of the usual fears of giving other people ideas. But questions have been raised that deserve an answer.