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Good news for charities

In times of recession and drop in revenues there is some good news for charities this week as VAT is waived on text donations. Several charities have been lobbying the mobile phone industry to get this charge stopped for some time.

On a £1.50 donation, typically only around 95p goes to the charity as VAT and a large cut for the network are deducted. This even applies to mobiles on monthly contracts where texts are free up to a limit, because charity donations are added to the donor’s network bill rather than deducted from their bank account. With the removal of VAT, around £1.12 will reach the charity making it a substantial increase.

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