The UK does not have a highly developed culture of individual charitable giving, especially compared to the United States. This report looks at the Maecenas Initiative which gives recommendations on how minor adjustments can be made to the UK’s fiscal framework to encourage individual giving.
The Gift Aid scheme is a good start to stimulating individual giving to the arts in the U.K. However, it is too complicated and does not appear to incentivise donors sufficiently, nor does it incentivise the right donors properly. Our survey results showing that Gift Aid is underutilized by donors is more evidence of what many commentators have already noted: it is a cumbersome, confusing process for donors, especially for higher rate taxpayers, the key constituency who provide the vast majority of charitable donations in the U.K. While the Gift Aid scheme may be simple for basic rate taxpayers (as the administration is borne by the charity), it is more complicated for higher rate taxpayers, the very group who should be cultivated.