Lib Dems call for the scrapping of VAT on RNLI donations

12.00.00am UTC (GMT +0000) Sat 15th Oct 2005

RNLI Inshore Lifeboat - every £1 donated to keep it afloat means the government collect the VAT on it

"We may not have the sea in Crawley but I'm happy to back Lib Dem MP Alistair Carmichael's call on the Government to scrap VAT being levied on donations to the Royal National Lifeboat Institute (RNLI)" says Northgate Councillor Linda Seekings. "Having seen the RNLI at work first hand I became a supporter of their work many years ago.

Last year the Treasury collected £3.2m in VAT payments from the RNLI. For every £1 of donations given to save lives at sea, the government took 3p in tax.

Mr Carmichael today wrote to the Treasury to urge them to review this policy.

Linda Seekings went on to say "Many residents of Crawley value the work done by the RNLI and make generous donations to the organisation simply because of this However, I expect that few people realise that for every £1 donation to the RNLI, the charity is forced to pay 3p in VAT payments to the government."

"The RNLI provides essential services cheaply. The Government should introduce a rebate scheme to make up for the VAT they pay. It is unacceptable that charities currently lose out in this way. If the RNLI did not carry out their work then the government would be forced to fund a lifeboat service themselves."