STRUGGLING charities have slammed George Osborne’s plans to cap tax relief on donations and warned that local good causes could suffer.

The Chancellor is proposing a controversial cap, set at 25 per cent of a donor’s income, if he or she is giving more than £50,000.

Diana Newbury, manager of the Daily Echo-backed Sparkle Appeal, which is fundraising for new hydrotherapy facilities for disabled children at Branksome’s Victoria School, said: “The economic climate has already caused a drop in individual donations during recent years.

“People are still being generous but they are struggling.

“Large donations are few and far between and securing grants from trusts is also difficult because they are not getting the same returns for their investments.

“We are concerned by any moves which could make it harder for charities to fundraise.”

Martin Edwards, chief executive of Julia’s House Dorset Children’s Hospice, said: “I think this is a poorly thought-through proposal, which can only harm philanthropic giving to charity.

“I can’t believe the government is digging its heels in and claiming it is about tax dodging which is an insult to people who have decided to put some of their good fortune back into the community.

“It makes people less likely to give big gifts.

“Measures like this will make it harder for charities to keep their heads above water.”

Tina Baker, chief executive of Dorset Community Foundation said: “The implied inference behind the proposal is that when the wealthy give large sums of money to charity it’s a tax dodge. This doesn’t stack up in terms of the facts and isn’t the experience of most charities.

“In fact we find the majority of our fund holders give because they are caring people who want to make a difference and give something back.”

Dorset Community Foundation is among charities across the country lobbying the Chancellor to reverse his proposal to cap tax relief on charitable donations.