Clause 58
Finance (No.2) Bill
10:45 am
Dawn Primarolo (Paymaster General, HM Treasury; Bristol South, Labour)
Company gift aid is a tax relief specifically designed for gifts to charities, not for payments that convey potential, substantial benefits on the donor company and those running it. In the Government’s view, the existing benefit limits are sufficient for charities to express their gratitude for a donation. We are talking about the benefits conveyed to the donor company by the charity when it says thank you for a donation. I say to the hon. Gentleman that there is no evidence to suggest that ensuring that donations to charities benefit principally the charity and not the giver—that is precisely what the clauses before us will do—will harm corporate giving.
A balance needs to be struck to ensure that companies do not benefit if they make a payment to charity with the aim of benefiting principally themselves and not the charity. The limit is there to prevent the glorious events that are designed to benefit those attending, but have little charitable benefit. That goes to the heart of the purpose of gift aid. I hope therefore that, given the narrow focus of the limit, the hon. Gentleman will accept that it is appropriate.
I remind the Committee that this series of clauses will deal with the misuse of charitable status by those who would put pressure on charities, or use them in order to benefit themselves, but not the charity. I want to reinforce that point. I hope that the hon. Gentleman will accept that explanation of why amendment No. 95 is unattractive and why I do not want the Committee to pursue it.