David Cameron today repeated the claim his spokesman made yesterday that one of the reasons for the cap on tax reliefs was that some wealthy people were putting money into bogus offshore charities as a way of reducing tax.
The prime minister said:
I’m quite convinced we can get the balance right increasing philanthropy and charitable giving, which is an important part of our culture which I want to see expanded, and making sure the tax system isn’t abused.
The government’s comments on this have been met with confusion: if bogus charities were in operation, why didn’t the Charity Commission stamp them out?
The answer, strangely, lies in a legal case launched by a German man, Hein Persche, against his local tax office in the province of Lüdenscheid, in 2009. Read more