Media Release

For immediate release

01 November 2006

Don’t ignore charity tax promises

Deferring government spending to pay for business or tax cuts should not come at the expense of the proposed changes to the taxation system for charities and other not-for-profit organisations.

Members of COmVOiceS, a coalition of Tangata Whenua, community and voluntary sector organisations, are concerned that recent comments made by Minister of Finance Hon Dr Cullen ignore the issue of reviewing the taxation regime for charities but focus on providing tax cuts for individuals and businesses.

“Labour and United Future have a clear Confidence and Supply Agreement that stipulates the issue of taxation for charities will be addressed within the current Parliamentary term.  It is concerning that yesterday’s speech makes no mention of this,” says Claire Szabo-Larsen, Chief Executive of the National Association of ESOL Home Tutor Schemes.

Groups within the community and voluntary sector have been working hard for the past 10 years to get tax issues onto politicians’ work programmes and there is an expectation that it will be addressed by the Labour-led government in this parliamentary term.

“This is an issue that needs to be addressed sooner rather than later. Many charities already find it difficult to fund their full range of services and tax relief is an important part of ensuring many groups are able to fund their activities in a more sustainable way,” says Tina Reid, Executive Director of the New Zealand Federation of Voluntary Welfare Organisations.

Community and voluntary groups deliver millions of dollars worth of services on behalf of Government. In a study of 10 New Zealand non-profit organisations it was shown to be about $3 and $5 worth of services for every $1 they receive in funding.

Robyn Scott, Executive Director of Philanthropy New Zealand says that the purpose of the proposed changes to the taxation regime for charities is to promote generosity – and there are options contained in the government’s discussion document that could affect businesses.

“The issues are not mutually exclusive – any discussion on personal or business tax cuts must include the context of the proposed changes to the taxation regime for charities as businesses and individuals could be affected by the changes,” she says.

ENDS