The Charity Retail Association strongly welcomes the Charity Tax Commission’s report – Reforming charity taxation: towards a stronger civil society – which was published today (Wednesday 17 July), in particular their recommendations on reforming the business rates relief system as applied to trading subsidiaries. Charities set up a trading subsidiary company in order to comply with charitable trading rules, but are sometimes penalised with removal of mandatory and/or discretionary charity relief when the trading subsidiary is assessed separately for business rates. We are delighted to see the Commission’s recommendation to remove this arbitrary barrier to charities’ income.
The report also calls for clearer guidance and a standardised application process for rates relief, and to end the postcode lottery surrounding business rate relief for charity shops.
The Commission, formed by the NCVO, has also recommended that the Government allow higher-rate taxpayers to pass their tax relief on to good causes, which the report claims could be worth around £250m a year.
Charity Retail Association Chief Executive, Robin Osterley, said: “We fully endorse the Charity Tax Commission report and recommendations, especially surrounding business rate relief for trading subsidiaries, which we lobbied for in both our written submission and in our work on the Commission’s reference group. If enacted, these recommendations would be of enormous benefit to our members.”