MPs Budget pleas over Charity Tax

4.33.00pm GMT Tue 25th Mar 2003

Vincent Cable, MP, has backed a motion in parliament calling on the Chancellor, in the forthcoming budget, to allow charities to recover VAT payments.

The Richmond Performing Arts Festival, for example, would recover £2000 on the hire of halls alone. All local charities pay substantial VAT on stationary, printing and other costs.

Vincent Cable said: "There is a 'penny wise, pound foolish' approach by the Treasury. If charities were not performing a host of social and cultural activities, responsibility would fall on the state and the tax payer; yet the Treasury treats charities as an easy source of tax revenue. "

"Excluding charities from VAT would be a minor budget cost but provide an enormous benefit".