05/05
8 January 2005
Brown announces VAT boost for disasters emergency committee
Chancellor of the Exchequer Gordon Brown today announced that the Treasury will be making a special donation to the Disasters Emergency Committee to offset the VAT charged on the proposed charity concert and charity records designed to raise money specifically for the tsunami appeal.
This will be in addition to the sum of at least £15 million the Treasury currently estimates will be given in tax relief on public contributions to the appeal made through the Gift Aid scheme.
In hundreds of cases throughout the country, CDs, tickets, and similar items are being sold to raise money for the tsunami appeal, and many businesses and performers are also donating the proceeds from their activities to the appeal.
As a one-off gesture, in light of the unprecedented public response to the tsunami appeal, the Treasury will be making a special contribution direct to the Disasters Emergency Committee - a sum which will match the VAT expected to be collected from these fund-raising sales of goods and services.
Gordon Brown said:
“Millions of people and businesses across Britain are showing their compassion and generosity. Where there has been a major concert or record in these circumstances in the past, the Treasury has been willing to make a donation equivalent to the VAT.
“I know there are many who will attend charity concerts, buy charity CDs, and buy other goods and services designed to raise money for the tsunami appeal.
“The Treasury will make a special donation which will cover the VAT charged on these purchases, and will make allowance for sales of other goods and services to raise money for the appeal, and thus we will ensure that all the proceeds go to ease the suffering of those people and communities affected by the tsunami tragedy.”
back to topNotes for editors
1. The Government will calculate the VAT receipts which will arise from sales of charity records, tickets for charity concerts and other sales of goods and services specifically intended to raise money for the tsunami appeal, and will make a special matching donation to the Disasters Emergency Committee.
2. The Government is also consulting closely with the organisers of special charity events to ensure that they organise them in a tax-effective way, without incurring unnecessary tax liabilities.
3. The Government is also working with the Disaster Emergency Committee and other charities to ensure that their publicity material and websites make clear to taxpayers the benefits for charity of using the Gift Aid scheme to make their donations (which allows the charity to claim an additional 28 pence for every pound they receive, and which has so far allowed the Disasters Emergency Committee to claim at least £15 million on top of the donations it has received from individual taxpayers).
4. In November, the Government announced that it would be making a one-off donation to the Band Aid Trust equivalent to the VAT charged on sales of the Live Aid DVD and Band Aid 20 record, following the precedent established after the release of the original Band Aid record in 1984. The Government also made a similar donation to the Princess Diana Memorial Fund equivalent to the VAT charged on sales of the ‘Candle in the Wind’ record, in light of the unprecedented national feeling following Princess Diana’s death.
5. Media enquiries should be addressed to the Treasury press office on 0207 270 5238.
6. Non-media enquiries should be addressed to the Treasury Correspondence and Enquiry Unit on 020 7270 4558, or by e-mail to public.enquiries@hm-treasury.gov.uk.
7. This press release and other Treasury publications and information are available on the Treasury website at www.hm-treasury.gov.uk. If you would like Treasury press releases to be sent to you automatically by e-mail you can subscribe to this service from the press release site on the website.