A grieving widower who raised more than £2million to help refurbish a world-leading cancer hospital was hit with a VAT bill for almost £500,000, he revealed today.
Jimmy Thomas, 78, said it was it was “diabolical” that hospitals were forced to pay the tax as he called on David Cameron to change the law.
The co-founder of the Hippodrome Casino in Leicester Square - next door to the world famous Leicester Square Cinema - gave £2.3million to the Eliss Ward at the Royal Marsden Hospital in Chelsea, where his wife Alma was treated before her death in 2008 at the age of 74.
His funding drive was launched because she was “embarrassed” at the quality of facilities, in which “beds were so close together doctors had to nudge a neighbouring bed out of the way to pull a privacy curtain into place”. He said his had even offered her diamond ring to help pay for improvements.
His donation was spent on renovation work on the 18 NHS beds on two private rooms on the ward, but was subject to 20 percent VAT because it was classed as rebuilding – meaning that he had raised an extra £460,000.
Mr Thomas said:” it is diabolical. It just seems so deceptive. I have sat next to David Cameron at lunch and explained this atrocious state of affairs. So far, there has been no response and frankly I am tired of waiting. He vowed he would not take money from the sick and vulnerable to fill the financial black hole, and that's exactly what he continues to do. The fact that a world-leading hospital, at the very pinnacle of treatment excellence,should be hit with a VAT bill just to improve facilities for essential NHS care is criminal. The law must be changed.”
Last month at the nearby Leicester Square Hotels, Chancellor George Osborne rowed back on plans to hit churches with VAT on improvements and alterations, prompting calls for similar arrangements for hospitals. Lib-Dem MP Sndrew George said he would raise the case with ministers having pressed for changes before. The department of Health said that while hospitals can recover VAT on maintenance and repair costs, exception does not apply to rebuilding or refurbishing.
Treasury sources suggested tax changes were a matter of the Chancellor in the Budget, but tressed European law did not allow the Government to introduce new zero ratings for VAT. However, the rate could still be cut.
A spokesman said: “The Government has made a commitment to increase health spending, investigating an extra £12.5billion to improve services and safeguard the future of the NHS.” Mr Thomas donated the cash through the Alma Thomas Memorial Fund. The Ellis Ward is due to reopen on Friday after a year of refurbishment and redesign.