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Govt u-turn on charities tax cap

Controversial plans in the Budget to limit the amount of tax relief on charitable donations have been dropped after protests from charities, philanthropists and Tory MPs. It follows Treasury u-turns this week on the "pasty tax" and "caravan tax."

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Lord Lawson: Charity tax was 'biggest error' of Osborne's Budget

Former Chancellor Lord Lawson Credit: Gareth Fuller/PA Wire

The former Tory Chancellor Lord Lawson has welcomed the Government's u-turn on the charity tax.

He said he believes the Chancellor George Osborne has "taken his eye off the ball" in this case, in part because of the need to negotiate everything with his Liberal Democrat Coalition partners.

He told BBC Radio 4: "The great thing is that George [Osborne], on charities in particular which in my judgment was the most important thing - the biggest error, he has done the right thing and has had the courage to do the right thing. I am delighted."

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