Tax Deductions for Charitable Donations : A Tax Expenditure Analysis

Australian income tax law provides taxpayers making donations to charities with a deduction for the amount of the donations. It also provides public benevolent institutions with an exemption from income taxation for income derived by way of gift or from the investment of donated funds. The continued viability of many, perhaps most, charitable institutions in Australia is attributable to these two factors. This paper subjects both these income tax benefits to a tax expenditure analysis