Government noise about reforming the charities sector seems to be just an empty echo, BRW reports this week.

May, the tax commissioner, Michael Carmody, came out with all guns
blazing and issued a 70-page draft ruling into the charities sector
aimed at narrowing its definition and reducing the number of
not-for-profit organisations claiming tax exemptions.” Adele Ferguson
writes. “As part of the clampdown, Carmody fired off letters to many
charities and non-government organisations (NGOs), informing them that
their tax-free had been revoked. Others received a warning via a court
case that of Public Benevolent Institutions (PBIs), which could be
construed as government entities, is also in the sights.

apparent crackdown on the $70-billion sector was reinforced by letters
from the federal Environment Minister, Ian Campbell, to environmental
groups saying that he, too, was reviewing the tax-deductible status of
green groups… Campbell warned them their tax-deductible status was at
risk if they engaged in ‘political activity’, advocacy or
awareness-raising. Instead, the funding would go to groups doing
on-the-ground work, such as tree-planting.”

And that’s where the
fun began. There’s a serious debate about when advocacy groups become
political organisations. The lines are very blurry. The tax clampdown
was marked by a dire warning of restrictions on freedom of speech.

the same time, though, issues of what happens with taxpayer-provided
public funding for elections – let alone other grants from the public
purse – are significant.

Despite the potential for abuse of public money for political campaigns, it all seems too hot to handle for the Government.

months on, nothing has happened,” Ferguson says. “The controversial
draft ruling is still to be determined – despite the rush to get the
sector to make a submission in a short time – and most of the letters
Carmody sent to charities and NGOs revoking their tax-free status have
recently been overturned after case-by-case discussions. Even the green
groups have missed a bullet; Campbell’s letters remain idle threats…

feeling is that, with all the controversy surrounding changes to the
industrial relations legislation and anti-terrorism, the Howard
Government does not need to attract the ire of the charities sector,
which represents about 10% of Australia’s gross domestic product,
includes more than 700,000 organisations, employs 600,000 people and
attracts more than three million volunteers each year. More important,
many of the country’s most powerful people either donate money or serve
on the boards of these charitable groups.”

And looking after
these people is much more important than being accountable to us about
how our tax dollars get spent, isn’t it?