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Could the Wilderness Society lose its charity status?
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Aid/Watch does good work. The Sydney-based NGO monitors Australian and multinational aid programs overseas to ensure the recipients are getting a bang for the buck they are meant to be receiving from donors. But it is not a charity for the purposes of tax laws in Australia, which means that donations to it are not tax deductible for the donor, according to a ruling by the Federal Court last week. A bench of three judges, Susan Kenny, Margaret Stone, and Nye Perram last week said that the Administrative Appeals Tribunal had been wrong to overturn a decision of the Commissioner of Taxation to refuse to grant Aid/Watch charitable status. According to the Federal Court, while Aid/Watch is undoubtedly concerned with poverty relief, a charitable purpose, it is also political organisation because, although it is not a lobby group, it attempts to persuade governments by monitoring, researching and campaigning. Aid/Watch does not directly alleviate poverty but rather seeks to influence government policy on aid, the court said. Aid/Watch is looking at going to the High Court — and that court may be tempted to look at the issue of charities and tax deductibility given it has been a matter of some political controversy in recent years. According to the reasoning in the Aid/Watch case, groups that are concerned with issues such as environmental protection, poverty, disabilities and the like need to demonstrate, if they are involved in any activities that can be characterised as seeking to influence public opinion or government policy, even indirectly through media and PR campaigns, that those political activities are merely incidental or ancillary to the charitable purpose of the organisation. One NGO that has long enjoyed status as a charity for tax purposes is the Tasmanian-based Wilderness Society. It is a multimillion dollar environmental protection and campaigning outfit that lives in the main off the considerable income it gets from tax deductible donations. But how is the Wilderness Society different to Aid/Watch? The Wilderness Society is undoubtedly a political campaigner. It has a history of lobbying governments about the protection of forests, particularly in Tasmania. And while it claims to be politically non-aligned it most definitely seeks to influence the political process directly and indirectly on a range of contentious issues such as nuclear energy, the proposed Gunns’ pulp mill in Tasmania, forests policy and climate change. Given the Aid/Watch ruling, would a court determine that the political and public influence activities of the Wilderness Society were merely incidental or ancillary to its charitable purpose — namely saving the physical environment? This is because even a cursory examination of the Wilderness Society’s modus operandi tells you that its main purpose these days is to change government policy on environmental issues — in fact that is its attractiveness to its donors. The Wilderness Society ought to look at what has happened to Aid/Watch very carefully because if it lost is charity status, its effectiveness as one of the leading environmental lobby groups in the country would be put at risk. |
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14 Comments
I remember while working int he Bathurst St office of Friends of the Earth Sydney, being asked to provide a written reference for Aidwatch to then Environment Minister John Faulkner.
I thought a while how to frame it and pointed out that it was ‘unsurprising for a green ngo to be interested in human rights and social justice issues of aid distribution particularly as it related to environmental sustainability of those aid programmes. FoE was a prime example domestically and internationally of a such a group that promoted environmentalism in a human rights context’.
The feedback from Aidwatch was that they were very happy with the reference. They got the nod from Faulkner’s office. One can be sure that the Howard regime would not have had any truck with this bleeding heart stuff but that was later.
My issue with all this, not having read the case or the legislation post Howard regime, is - how bogus to say charities ought not be political. Totally bogus.
One can argue the flipside of the coin - why are the donors to say IPA, or Sydney Institute secret. But that’s too indirect.
The fact is charities must be political within their public interest defined purpose. To say otherwise is a direct attack on freedom of speech. As everyone knows whole slabs of public policy let alone industry sectors (media anyone) live and die based on govt fiat, licensing, legislative tweaks etc.
For an ngo charity not to focus on govt policy would be an utter dereliction of their public purpose. Truly the law is an ass (speaking as a solicitor in NSW admitted 1990).
An appeal to the High Court is as well may be. But the federal govt should change the legislation.
As for TWS - in the age the internet methinks they will prosper with our without tax deductibility. Just like Barak Obama. It was never about lack of public support but the cost of logistics. As Gandhi said - a just cause never failed for lack of money. Just as Gunns is wasting its shareholders money on little green books of lies (speaking as a anu zoology grad) about forest destruction. Cut and Paste sure got that right today.
I don’t have any problem with aid groups being granted charity status for tax purposes, but it is pertinent to remember that any group being given this benefit is asking the government to forgo
revenue. That is the taxpayers in general are paying for the benefit.
Those taxpayers who think that, say, the Wilderness Society deserves their support should be prepared to donate to them whether or not they receive a tax benefit from their donation.
Tom, Is the Sydney institute registered as a charitY? I don’t think so. Thus they do not need to claim tax deductible status or disclose their donors.
Basically you are saying that as a charity, it is all right for an organisation to engage in political lobbying to support a particular shade of the political spectrum (one which seems to meet with your approval) and basically cheat the taxpayer out of tax revenue that they (the charity) should pay, therefore costing everyone a tiny bit more in taxes to make up the difference.
However a good percentage of the nation’s taxpayers may not support the aims of the ‘charity’ in question, but have no choice about subsidising (through tax deductible charity status) its political activities.
Would you support the activities of the IPA or the Armed Forces Association, or even the Sydney institute, as charities. They seek to raise awareness of issues and perform lobbying activities to gain political support for their policy aims and objectives, in a very similar way to someone such as Aidwatch or the Wilderness Society.
There is no doubt that a segment of the community would support their activities, so therefore why shouldn’t they be a charity in your view. How do they differ from the Wilderness Society, Greenpeace of Aidwatch?
Tom, you say “My issue with all this, not having read the case or the legislation post Howard regime, is - how bogus to say charities ought not be political. Totally bogus.”
The problem with this is, the legislation being used has been there for many years prior to Howard becoming PM.
Your point is that a policital lobbying outfit should be able to attract deductible gifts - how about the Australian Christian Lobby? They are a political lobbying outfit and I note, from a quick search on the Australian Business Register, they are not entitled to receive deductible donations.
I agree with the law and the ATO - this is the way it should be. From the article it appears Aidwatch may have been originally registered as a Public Benevolent Institution. To be eligible there needs to be some actual “benevolence” shown - ie charity towards people in situations that would arouse pity or compassion in the general community (this is a paraphrase of the ATO definition) - whilst I agree many politicians are pathetic I cannot see them arousing much pity or compassion - so lobbying is out.
Well without going specifically to the comments as such, what it comes down to is the govt deciding in legislation if the objectives of the ngo are a genuinely public benefit or not. In the case of the environment that’s generally understood as a public good, public commons etc. So tax dollars are properly allocated even if some prefer not (some would not save a drowning sibling either.) So if an ngo is genuinely working for that public purpose, then in a bipartisan way that becomes a valid tax deductible purpose.
Now the govt might decide no, wilderness is a dumb idea, and not the kind of environment we want to promote. But then it would need to run that at an election surely.
And people forget the first legislation in Australia from memory re wilderness protection, being the The Wilderness Act NSW 1987 had bipartisan support. Yep. Also the demographic support for TWS (when say I was NSW Campaign Coordinator 93-94 was concentrated in places like … the seat of Bradfield … really, and I don’t believe it’s changed: All that libertarian survival of the fittest against nature, self reliant recreation, finding your identity and your limits, nurturing the spirit of adventure, and yeah and “eco-system services” in econo speak.
A current Liberal Party Opposition minister told me way back in the day that he didn’t always agree with us but he knew it was critical for democracy to balance up the other side - the extractive resource users etc.
As for the IPA, CIS, SInst etc what I would say is if they can frame what they do as a public good of bipartisan and all parties generic support - say public interest investigative journalism might be one, or open forum public interest debating house, or public policy academic excellence (rather than one ideological slant), then I think they might well have a case for arguing tax deductibility. Conversely bodies interested in industrial justice for labour might have a case too, say regarding reduction of fatal injuries in the workplace, removal of asbestos from society etc.
But the thing with TD is - you have to be very transparent and methinks that’s not for everyone especially privileged self interest.
“In the case of the environment that’s generally understood as a public good, public commons etc. So tax dollars are properly allocated “
Aren’t you changing the debate Tom? It’s about whether organisations such as, for example, the Wilderness Society are charities within the meaning of the act isn’t it? It is not whether they benefit the community as a whole. They may well do, but that isn’t the point here.
Can anyone tell me if Surf Life Saving Clubs pay the same taxes as commerical operators when they compete with nearby private businesses in the same field?
Of course the Wilderness Society is primarily a lobbying organisation, not a charity. But given that donations to political parties are now tax deductible (up to $1500) anyway, would changing their official status accordingly make that much difference?
One would imagine, from a lay point of view, that a distinction ought to be made between charity and benevolence. Certainly it is true that any aid organization would be derelict in its duty if it did not try to influence government policy, since that is often the single greatest barrier to the equality these organizations seek to redress. Taxwise, its a bit of a furphy in that donated money has already been taxed as income, and will be spent again in ways that attract GST (excepting exempted foodstuffs). Money spent on wages for employees is taxable again in the ordinary way. A taxation on an organization which redistributes money but does not earn any for itself or its shareholders would seem, well, uncharitable. The argument of the public good is a worthwhile and continually re-assessable one.
Churches are tax exempt and yet operate as an ideological lobby, even if the Australian Christian Lobby does not qualify - there is an obvious argument that a christian lobby exercises a MALevolent ideology in that it seeks to resist equality.
A charity gives, one supposes, aid and comfort of some sort. An aids organization, it might be argued, provides far more in the nature of aid and comfort in most African nations than any christian organization which ignores these issues and the hundreds of thousands of deaths caused by HIV aids, and yet which still claims to be addressing the public good. You would be hard pressed to find anyone who does not acknowledge Aids as an area where help is required - plague sent by a vengeful god as payment for sexual irresponsibility notwithstanding.
A wilderness society, on the other hand, may more likely be considered an animal rights lobby than an aid organization. Yes, the environment is important to some, but not to all on the scale argued by the w. society. Nevertheless it is a lobby that seeks to provide a voice for those that have none. We can argue about how much a voice animals and forests deserve, but surely that will be determined by the funds it can raise in a crowded market for the charity dollar. The point is that without an genuine avenue for the voices of the disenfranchised we suffer a failure of democracy.
The idea that the Sydney Institute is a lobbying force for the greater good is laughable - it is a special interest group that is funded by and seeks to gain benefit for individual shareholders in corporations purposed to do just that. It is also in no danger of being disenfranchised, having, as it does, weekly presence in daily newspapers. What it seeks to protect is a political ideology and party that can hardly be argued to be in need of protection or succour.
And Mr James: How is lobbying for a greater equality part of an argument in support of a particular political spectrum? Is the essence of that argument that a voice for the disenfranchised is in essence an ideological argument of partisan nature, and therefore ought to be considered equal to a voice that decries that equality in the name of a financial benefit? Is it really that bad, that the political divide runs down the lines of equal voices for those who are unrepresented and dying of disease and deprivation, and those who seek the right to make profit at their expense? Do we really want to equate their ‘policy objectives’? Do we really believe that both deserve equal time and indulgence?
I’m not sure I’m really following this discussion correctly, but can it be said that all charities are lobbyists (because surely they are, on some level) but not all lobbyists are charities? To be the former, do you have to run activities other than just lobbying? (E.g. Oxfam has community aid programs). I’m not sure where that puts a group like Amnesty - they have all sorts of programs, but they’re kind of all lobbying activities - even if only on behalf of one person, who is being held a political prisoner.
There is more than one category of NGO to whom tax deductible donations may be made. A number of environmental organisations, including the Wilderness Society are members of the Register of Environmental Organisations. The guidelines don’t include a reference to “political” or “lobby,” but the constitution of the organisation must state that its “Principal Purpose must be the Protection of the
Natural Environment.” There is a definition given for the natural environment:
Members of the register need to satisfy a set of guidelines, which include the establishment of a separate (from the administration of the organisation) public fund to receive donations.
The guidelines also state that members of the REO may also qualify for endorsement by the ATO as an income tax exempt charity (ITEC). This may well apply to the bigger groups like the Wilderness Society, and this could be the context in which the ruling discussed in the article could affect them.
Jerome Ehlers, it’s misleading to say flatly that churches are tax exempt. There’s nothing deductible about the donations that go into offering bowls/bags/trays every Sunday.
True enough, Mark Duffett, but neither is a church required to declare those donations nor prove any accountability in order to keep its status as an organization that does not PAY any taxes.
But from what you’re saying, the only way they can keep their charity status is to give up not just their lobbying efforts, but also to cease any action that might increase public awareness of the issues they’re fighting for?