Abstract
This paper was presented at the symposium dedicated to the 25th anniversary of the publication of Patrons Despite Themselves: Taxpayers and Arts Policy (Feld et al. 1983), held by the Association for Cultural Economics International, Boston, June 2008. Patrons Despite Themselves raised and tried to answer a number of important questions of policy concerning indirect government support for the arts. These questions have continued salience for what we see in our museums and hear in our concert halls. The primary source of federal indirect aid in the U.S. continues to derive from the deduction in the federal income tax for contributions to not-for-profit cultural institutions. On the other hand, there has been a series of recent challenges to the tax-exempt status of charitable institutions.
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Notes
US Internal Revenue Service, 27 SOI Bulletin 67–89 (2008).
Internal Revenue Code section 170(o).
The government generally does not report tax expenditures for charitable contributions to cultural institutions separately. The federal tax expenditure for individual charitable contributions not made to health or education institutions—the category of “other”—was approximately $5.7 billion in 1980 and estimated at $42 billion in 2008. Assuming the percentage of this category going to cultural institutions remained constant at 5%, the tax expenditure for charitable contributions to cultural institutions was $285 million in 1980 and an estimated $2.1 billion in 2008.
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Feld, A.L. Revisiting tax subsidies for cultural institutions. J Cult Econ 32, 275–279 (2008). https://doi.org/10.1007/s10824-008-9082-y
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DOI: https://doi.org/10.1007/s10824-008-9082-y