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AFP Rebuts Opinion Piece on Charitable Giving Incentive

AFP has responded to a recent opinion piece in the Financial Post about the federal government reversing course in its budget on the capital gains exemption for some gifts of stock and land. Click here for the original piece, and below is AFP’s response, submitted by Dan Brunette, chair of AFP’s Canada Government Relations Committee.

Re: “Liberals are right to cancel charitable tax breaks” (Jack Mintz, April 12, 2016)

Tax credits and giving incentives are not the reason most people contribute to charity. The majority of people donate because they are generous. But giving incentives can affect the size of the gift, encouraging people to donate more than they would without the incentive. This is especially true as people consider making larger gifts, and that is why the capital gains exemption for gifts of land and stock is so important.

Mr. Mintz references the cost of tax incentives, but then acknowledges that “tax support is not nearly as expensive as the table shows.” He uses inflated numbers and significantly overstates the cost to the government of the average donation, especially for donors giving under $200.

The defining characteristic of the charitable sector is what we achieve—impact in our communities. Tax incentives enhance that impact by encouraging and sustaining a culture of giving in our country. They reward a selfless act and ensure a greater amount of charitable donations can contribute to community building—locally, nationally and internationally.

In the end, tax treatment of charitable donations should reflect the values and character of the country we want to have. We should aim for tax policies that recognize the economic and social benefits of giving and encourage people to engage with their communities.  The revoking of this initiative, which has broad not-for-profit sector support, does the opposite and should be reconsidered.

Dan Brunette
Chair, AFP Canadian Government Relations Committee
Association of Fundraising Professionals

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