§ Mr. Don FosterTo ask the Chancellor of the Exchequer (1) what representations his Department has received from(a) the museum and (b) the heritage sector in relation to introducing gift aid tax relief in (i) writing, (ii) meetings and (iii) other forms since 1997; and if he will make a statement; [155988]
(2) what estimate he has made of the cost to museums of (a) computer equipment, (b) staff, (c) administration and (d) other costs in relation to claiming gift aid; and if he will make a statement; [155989]
(3) pursuant to the answer of 15 January 2004 to the hon. Member for Leominster (Mr. Wiggin), Official Report, columns 865–6W, on gift aid, what research his Department has conducted into the impact of lost gift aid revenue on (a) national museums, (b) independent museums, (c) country houses and (d) royal buildings; and if he will make a statement. [155990]
§ John HealeyMinisters and officials from the Treasury and Chancellor's Departments regularly receive a wide range of representations from museums and the heritage sector, including many on the benefits they receive from Gift Aid.
In April 2000 the Government made improvements to the Gift Aid scheme, as part of a wider package to make the tax system simpler for charities and their donors and to encourage greater charitable giving. In 2002–03 charities received donations under Gift Aid of £2.3 billion, including tax relief from the Government of £506 million.
Under a special exemption introduced in 1989 and imported into Gift Aid as part of a wider reform in 2000, certain heritage and conservation charities are able to claim Gift Aid on membership subscriptions in the same way as they were previously able to claim tax refunds under Deeds of Covenant. Deeds of Covenant lasted for at least three years, meaning that a donor was required to have an ongoing commitment to a charity, but Gift Aid can apply to one-off donations as well.
A number of charities eligible for the special exemption are claiming Gift Aid tax refunds under so-called 'day membership' schemes. These schemes do not generate additional giving, but simply reclassify admission fees as donations on which Gift Aid is being claimed.
The Chancellor of the Exchequer announced in the pre-Budget report (Cm 6042) that the Government will amend the Gift Aid legislation to ensure that the special exemption applies as it was originally intended and not to these 'day memberships'.
This will mean that heritage and conservation charities will continue to benefit from the special exemption where a donor has an ongoing commitment to the charity, such as an annual membership, and these charities—like other fundraising charities—will continue to benefit from Gift Aid on other donations of money.
The Government is consulting closely with charities that might be affected, directly and through their associations and representative bodies, on the detail of how the change may best be achieved.
1751WAs I made clear in my earlier answer, no estimate is available of the amount of money being claimed by charities which are taking advantage of this. Charities are not required to differentiate on their Gift Aid claims the amounts they are claiming for 'day membership' income from other amounts they are claiming. No estimate has been made of the cost to museums of claiming the Gift Aid benefits they enjoy.