Philanthropy Ireland says that strategic giving in Ireland has not grown or developed since changes in how taxable donations are treated were introduced by the government in 2013.

Research carried out by the representative body shows that the scheme introduced in 2013 has not been effective in mobilising large-scale philanthropic giving. 

Overall, donations decreased by 24% from 2010 to 2016, from €120m in 2010 to €92m in 2016, with a modest 1.7% increase in the value of donations between 2013 and 2016.

The report prepared by BDO includes data from Revenue alongside international and domestic research on philanthropy, the not-for-profit sector and the tax treatment of charitable donations, combined with stakeholder interviews with government departments, state agencies, philanthropic bodies and charitable organisations.

Chief executive Éilis Murray said: “The research indicates that less than 1% of donations are greater than €5,000 and a mere 0.3% are greater than €10,000. 

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“This suggests the current scheme is not effective in mobilising large-scale philanthropic giving, with over 90% of donations characterised as smaller charitable donations. As we seek to develop philanthropy in Ireland for the benefit of society, this is of key concern.”

The clue to this lies in the fact that Ireland is the only country that does not provide a tax stimulus that goes directly to the donor. 

It is also the only country that uses exclusively a grossed-up donation, a blended rate of tax relief of 31% applying to treatment of donations.

This practice is contrary to a key recommendation from the government-led Forum on Philanthropy and Fundraising in 2012 which was never activated — that for donations into designated vehicles such as grant-making trusts and foundations, relief at the marginal tax rate should go direct to the donor, within bands of €5,000 and €1m on individual donations.

PI chair Bernard Kirk added: “It is notable that the only recommendation of the 2012 report not implemented was the one for major gift giving. It is timely that this now be reviewed for activation.”

The full report is available here.

Photo: Derry Gray and Ciaran Brannigan of BDO. (Pic: Austin Healey)