Chancellor George Osborne pledged £15m in VAT revenue from the so called ‘tampon tax’ to women’s charities and promised £25m raised from banking fines to military charities in today’s Autumn Statement.
Women’s charities receive boost
The money pledged to women’s charities is the government’s attempt to redress the balance for the VAT levied on sanitary products.
Osborne said Westminster would lobby the EU for a zero rate of VAT on these items but in the meantime the new £15 million annual fund – equivalent to the money raised each year on sanitary products – will be given to women’s charities.
The government will make an initial donation of £5m to support The Eve Appeal, SafeLives, Women’s Aid and The Haven.
Further donations and recipients will be announced at Budget 2016, with the fund running over the course of this Parliament, or until the UK can apply a zero rate.
Fillip for military charities
The £25m of banking fines pledged to military charities and good causes will be allocated over the next three years, including £4.7m for Guide Dogs for Military Veterans, £2 million for Direct Skeletal Fixation and £1.6m for SkillForce.
The good news was tempered by Osborne’s announcement that the main local government grant will be phased out, which could have a knock-on effect on the level of contributions charities receive from local authorities.
Commenting on these concerns, chief executive of the Charities Aid Foundation John Low, said: “As the government makes potentially big changes to the way government funds and delivers services for people, ministers must work with charities to ensure people have the support and help they need if the state pulls back.
“The Chancellor’s emphasis on expanding the National Citizen Service and his windfall grants to a number of charities are undoubtedly good news for those involved, but the impact of the longer term financial settlement on charities is yet to be fully understood.
“At a time when there is a need to strengthen local communities, we need to ensure that charities retain their pivotal role in society and are not simply expected to fill the gap left by cuts.”
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