George Osborne has announced that the Budget proposal to limit the tax break on individuals giving to charitable organisations has been scrapped.

The measure would have meant that any individual giving to charity would have had their income tax relief capped at £50,000 or 25% of his or her total income, whichever was the larger. The proposal provoked negative comments when it was announced in March’s Budget and caused a storm of protest from charities which feared that the cap could cut their resources by up to £1.5 billion.

A consultation had been proposed by the Chancellor to deal with the government’s general plan to cap income tax relief, which had been hoped would allay the charities’ concerns. However, the surprise announcement from the Treasury has meant that the charitable element of the planned cap will no longer need to be considered.