Search This Blog

Wednesday, 18 April 2012

Philanthropy debate...what actually is charity?

The debate over the Government's plans to reduce the amount of tax relief someone can get down to £50,000 a year or 25% of income is raging because so-called philanthropists are arguing that it will reduce the amount of charity donations they will give. I have a question - if they will only give to charity if they are given tax relief are they really a philanthropist?

Let's just take a step back and look at what tax is actually for. The idea is that it pays towards those items that society needs to make it work - such as the state education system, the NHS, national defence, policing etc. Without enough money to fund them these areas would suffer and society would suffer. If you like, you are 'donating' money anonymously for the public good. We don't get a plaque in our honour, nor a dinner to celebrate our generosity, or our picture in the paper, we just have to trust that we might be living in a more socially just society.

Should someone earning a large amount of money decide that instead of paying into this vital pool of money through their income tax they should be able to choose where it goes themselves? A definition of philanthropy is "he effort or inclination to increase the well-being of humankind, as by charitable aid or donations". 

In the Independent today, Mark Steel writes a coruscating critique of the current uproar (click here for this)
and puts it beautifully - "rather than funding the NHS through compulsory taxation, we get millionaires to wander round a ward and give a few pounds if they see a patient they think deserves curing."

If you look at it that way - this debate takes on a whole new meaning. The governing coalition - who are trying to deal with a crushing public debt, are trying to find ways to increase tax revenue. So, and this is a cynical example I know - if the Treasury are receiving less revenue because, for instance, a 'philanthropist' has made a massive donation to a top university that his children might not have the academic ability to get into - then the public surely have a right to question whether that should attract tax relief. 

Then think about the fact that 'philanthropists' donate to the arts - claiming that the government are cutting funding. But the government are cutting funding because they have to due to the deficit, which is partly caused by tax revenue falling which is partly caused by many people not paying their far share.

So, how about this can be called a philanthropist if you donate to charity....after you have paid your fair share of tax. If you demand tax relief before you will donate to charity, then society is possibly not receiving a net gain. 

So how about a about you get tax relief on £50,000 a year or 25% of your income? Oh, wait a minute...that's the new policy.

No comments:

Post a Comment