Clause 57 - Relief for community amateur sports clubs
Finance Bill
11:00 am
Mr Howard Flight (Arundel and South Downs, Conservative)
The new clause is designed to probe the Government's intentions. Hon. Members will be aware that there has been an historic problem with sports not being deemed suitable activities for a charity. The Charity Commission refined that last November by decreeing that sports activities whose ultimate objectives were health and fitness could be
viewed as suitable activities for a charity. In principle, that enabled a large number of sports clubs to qualify as charities. However, certain sports do not qualify, including angling.
Clause 57 and schedule 18 are designed to provide a framework of tax relief to those amateur sporting clubs that either cannot qualify as a charity or that decide that they do not want to do so. However, if an appropriate amateur sporting club is dedicated to a sport that does not qualify for charitable status, why have the Government not, for the sake of simplicity, granted tax exemptions that are parallel to those that would apply if it could qualify as a charity? We have, in effect, two sets of rules for sports clubs, one of which falls into the Inland Revenue's box and the other into the charitable box. They are not greatly different, but a few important differences relate to gifting and trading income. The Revenue impact will hardly be significant, so would it not have been simpler—per what new clause 3 would achieve—to give entirely parallel tax facilities to those available to charities?
On the subject of golf clubs and exploitation for social activities, the schedule empowers the Treasury to specify an eligible sport, so protection is retained against an exploitation of the principle. It seems unnecessary, however, to have cluttered up the system with two different tax packages. People who might want to support amateur sports clubs will make mistakes, which puts an onus on those running clubs to understand in detail both the charity rules and the Inland Revenue rules. Does it make sense to introduce a different tax package for such clubs?