Government plans to cap charitable donations scrapped

Chancellor George Osborne at 11 Downing Street. Credit: Reuters

Controversial plans to cap tax relief on charitable donations have been scrapped by Chancellor George Osborne, the Treasury has announced.

The cap - limiting relief at £50,000 or 25% of income - was proposed in Mr Osborne's March 21 Budget but sparked massive protest from charities, who warned they could lose a significant proportion of their income.

Announcing the latest in a string of U-turns on Budget proposals, following climbdowns on the "pasty tax" and "caravan tax" earlier this week, Mr Osborne said that he would be pressing ahead with the cap on income tax reliefs for wealthy people which do not relate to charitable donations.

Senior Political Correspondent Chris Ship reports on today's Government u-turn:

But Labour has accused Mr Osborne of trying to "bury bad news" by unveiling his latest climbdown while Culture Secretary Jeremy Hunt was giving evidence to the Leveson Inquiry.

David Bull, the Executive Director of UNICEF UK, has welcomed the news. He said:

To read ITV News' Political Correspondent Lucy Manning's analysis click here.