Skip to main content
SpringerLink
Log in

The Influence of Fiscal Incentives on Philanthropy across Nations

  • Chapter
The Palgrave Handbook of Global Philanthropy

Abstract

As Hondius (2004, p. xi) observes, ‘Tax treatment is the barometer of the high or low esteem in which States hold the voluntary sector.’ At first blush it seems that most nations around the globe, including those discussed in this volume, hold their voluntary or nonprofit sectors in relatively high esteem, as evidenced by the near universality of their exemption from the payment of income taxes and the provision of fiscal incentives to promote donations. But in this theme, the devil is in the details: how many organizations are eligible for deductible donations? How beneficiai are the fiscal incentives to donors? What impact do fiscal incentives have on philanthropy? And, more generally, what impact does a favorable fiscal environment have on the development of a nation’s nonprofit sector?

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 229.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Hardcover Book
USD 299.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  • Andreoni, J. (1990). Impure altruism and donations to public goods: A theory of warm-glow giving. Economic Journal, 200(401), pp. 464–477.

    Article  Google Scholar 

  • Bekkers, R., & Wiepking, P. (2011). A literature review of empirical studies of philanthropy: Eight mechanisms that drive charitable giving. Nonprofit and Voluntary Sector Quarterly, 40(5), pp. 924–973.

    Article  Google Scholar 

  • Benshalom, I. (2008). The Dual Subsidy Theory of Charitable Deductions. Retrieved August 1, 2014, from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1117549##.

    Google Scholar 

  • Brody, E. (1998). Of Sovereignty and Subsidy: Conceptualizing the Charity Tax Exemption. Retrieved October 10, 2013, from http://ssrn.com/abstract=918129.

    Google Scholar 

  • Colinvaux, R. (2013). Rationale and Changing the Charitable Deduction. Tax Notes, 138, pp. 1453–1459. Retrieved October 10, 2013, from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2244915.

    Google Scholar 

  • Cordes, J.J. (2011). Re-thinking the deduction for charitable contributions: Evaluating the effects of deficit-reduction proposals. National Tax Journal, 64(4), pp. 1001–1024.

    Article  Google Scholar 

  • Ferris, J.M. (1998). The role of the nonprofit sector in a self-governing society: A view from the United States. Voluntas: International Journal of Voluntary and Nonprofit Organizations, 9(2), pp. 137–151.

    Article  Google Scholar 

  • FGS Consulting, Irish Charities Tax Research Ltd., & Philanthropy Ireland (2009). Research into Tax and Regulatory Policy in Ireland to Encourage Greater Philanthropy. Retrieved October 10, 2013, from http://www.ictr.ie/files/Research%20into%20Tax%20and%20Regulatory%20Policy%20in%20Ireland%20to%20Encourage%20Greater%20Philanthropy1.pdf.

    Google Scholar 

  • Giving Pledge (2013). Homepage. Retrieved October 10, 2013, from http://givingpledge.org/.

    Google Scholar 

  • Guardian Professional (2013). Voluntary Sector Reactions to the 2012 Budget. Retrieved September 21, 2013, from http://www.theguardian.com/voluntary-sector-network/2012/mar/21/voluntary-sector-budget-reactions.

    Google Scholar 

  • Hondius, F. (2004). An Enabling Climate for NGOs — The Role of the Europhil Trust. In P. Bater, F. Hondius, & P. Kessler Lieber (Eds.), The Tax Treatment of NGOs: Legal, Tiscal and Ethical Standards for Promoting NGOs and Their Activities (pp. xi–xviii). New York: Kluwer Law International.

    Google Scholar 

  • Hossain, B., & Lamb, L. (2012). Does the effectiveness of tax incentives on the decision to give charitable donations vary across donation sectors in Canada?. Applied Economics Letters, 29(15), pp. 1487–1491.

    Article  Google Scholar 

  • House Committee of Ways and Means (2013a). Camp Announces Hearing on Tax Reform and Charitable Contributions. Retrieved October 10, 2013, from http://waysandmeans.house.gov/news/documentsingle.aspx?DocumentID=318995.

    Google Scholar 

  • House Committee of Ways and Means (2013b). Hearing on Tax Reform and Charitable Contributions. Retrieved October 10, 2013, from http://waysandmeans.house.gov/calendar/eventsingle.aspx?EventID=319000.

    Google Scholar 

  • Independent Sector (2003). Deducting generosity: The effect of charitable tax incentives on giving. Retrieved October 10, 2013, from http://www.independentsector.org/uploads/Resources/deducting_generosity.pdf.

    Google Scholar 

  • Internal Revenue Service (2013). Applying for 501(c)(3) Tax-exempt Status. Publication 4220 (Rev. 8–2013). Catalog Number 37053T. Retrieved October 10, 2013, from http://www.irs.gov/pub/irs-pdf/p4220.pdf.

    Google Scholar 

  • Irish, L.E., Kushen, R., & Simon, K.W. (2004). Guidelines for Laws Affecting Civic Organizations. New York: Open Society Institute.

    Google Scholar 

  • Joint Committee on Taxation (2013). Present law and background relating to the federal tax treatment of charitable contributions. Retrieved September 23, 2013, from https://www.jct.gov/publications.html?func=download&id=4506&chk=4506&no_html=1.

    Google Scholar 

  • Lin, H-Y. & Lo, K-T. (2012). Tax incentives and charitable contributions: The evidence from censored quantile regression. Pacific Economic Review, 17(4), pp. 535–558.

    Article  Google Scholar 

  • McDonald, K., & Scaife, W.A. (2011). Print media portrayals of giving: Exploring national ‘cultures of philanthropy’. International Journal of Nonprofit and Voluntary Sector Marketing, 16(4), pp. 311–324.

    Article  Google Scholar 

  • Murphy, R. (2013). Tax, power and philanthropy. Retrieved September 19, 2013, from http://www.alliancemagazine.org/en/content/tax-power-and-philanthropy

    Google Scholar 

  • Peloza, J., & Steel, P. (2005). The price elasticities of charitable contributions: A metaanalysis. Journal of Public Policy & Marketing, 24, pp. 260–272.

    Article  Google Scholar 

  • Productivity Commission (2010). Contribution of the Not-for-Proflt Sector. Retrieved October 10, 2013, from http://www.pc.gov.au/_data/assets/pdf_file/0003/94548/not-for-profit-report.pdf.

    Google Scholar 

  • Reich, R. (2005). A failure of philanthropy. Stanford Social Innovation Review, 2, pp. 24–33.

    Google Scholar 

  • Reich, R. (2013a). Philanthropy and caring for the needs of strangers. Social Research: An International Quarterly, 80(2), pp. 517–538.

    Google Scholar 

  • Reich, R. (2013b). What are foundations for?. Boston Review Forum. Retrieved August 1, 2013, from http://www.bostonreview.net/forum/foundations-philanthropy-democracy.

    Google Scholar 

  • Salamon, L.M., & Anheier, H.K. (1998). Social origins of civil society: Explaining the nonprofit sector cross-nationally. Voluntas: International Journal of Voluntary and Nonprofit Organizations, 9, pp. 213–248.

    Article  Google Scholar 

  • Salamon, L.M. (2010). Putting the civil society sector on the economic map of the world. Annals of Public and Cooperative Economics, 81(2), pp. 167–210.

    Article  Google Scholar 

  • Salamon, L.M. & Toepler, S. (2000). The influence of the legal environment on the development of the nonprofit sector. Working Paper Series No. 17. Baltimore, MD: The Johns Hopkins University Institute for Policy Studies/Center for Civil Society Studies.

    Google Scholar 

  • Senate Finance Committee (2013). Tax-exempt Organizations and Charitable Giving. Senate Finance Committee. Retrieved September 20 from http://www.finance.senate.govissue/?id=046eclca-5al3–4dc2–83ee-30a92cafbd73.

    Google Scholar 

  • Servicio de Administración Tributaria (2012). Donatarias autorizadas: Requisitos, ventajas y obligaciones fiscales. Retrieved September 20, 2013, from ftp://ftp2.sat.gob.mx/asistencia_ftp/publicaciones/folletos12/donautoriz_03052012.pdf.

    Google Scholar 

  • Simon, J., Harvey, D., & Chisolm, L. (2006). The Federal Tax Treatment of Charitable Organizations. In W.W. Powell & R. Steinberg (Eds.), The Non-profit Sector: A Research Handbook (2nd ed.) (pp. 267–306). New Haven, CT: Yale University Press.

    Google Scholar 

  • Sokolowski, S.W. (2013). Effects of government support of nonprofit institutions on aggregate private philanthropy: Evidence from 40 Countries. Voluntas: International Journal of Voluntary and Nonprofit Organizations, 24(2), pp. 359–381.

    Article  Google Scholar 

  • Standing Committee on Finance (2013). Tax incentives for charitable giving in Canada. February. Parliament of Canada. Retrieved September 26, 2013, from http://www.parl.gc.ca/HousePublications/Publication.aspx?DocId=5972482&Language=E&Mode=1&Parl=41&Ses=1&File=21#intro.

    Google Scholar 

  • Steinberg, R. (1990). Taxes and giving: New findings. Voluntas: International Journal of Voluntary and Nonprofit Organizations, 1(2), pp. 61–79.

    Article  Google Scholar 

  • Thaler, R.H. (2010). It’s Time to Rethink the Charity Deduction. Retrieved October 10, 2013, from http://www.nytimes.com/2010/12/19/business/economy/19view.html.

    Google Scholar 

  • Thorndike, J.J. (2013). Making the World Safe for Philanthropy: The Wartime Origins and Peacetime Development of the Tax Deduction for Charitable Giving. Retrieved October 10, 2013, from http://www.taxpolicycenter.org/UploadedPDF/412812-making-the-world-safe.pdf.

    Google Scholar 

Download references

Authors
  1. Michael D. Layton
    View author publications

    You can also search for this author in PubMed Google Scholar

Editor information

Editors and Affiliations

  1. Erasmus University Rotterdam, the Netherlands

    Pamala Wiepking (Assistant Professor) (Assistant Professor)

  2. School of Social Policy and Practice, University of Pennsylvania, USA

    Femida Handy (Professor) (Professor)

Copyright information

© 2015 Michael D. Layton

About this chapter

Cite this chapter

Layton, M.D. (2015). The Influence of Fiscal Incentives on Philanthropy across Nations. In: Wiepking, P., Handy, F. (eds) The Palgrave Handbook of Global Philanthropy. Palgrave Macmillan, London. https://doi.org/10.1057/9781137341532_31

Download citation

Publish with us

Policies and ethics

Search

Navigation