NGOs condemn discriminatory tax rebate for Community Chest

Environmental, human rights, Christian, and health non-governmental organisations have hit out at the government’s decision to launch a tax rebate scheme for companies that donate to the Malta Community Chest Fund.

SKOP – a national platform that represents 24 NGOs including the Malta Gay Rights Movement, the Malta Forum for Justice and Cooperation, Moviment Graffiti, and Christian group CAM Youths – led the charge in their criticism against the national fund.

“We strongly condemn the government’s decision to provide preferential treatment to the Malta Community Chest Fund over all other Maltese non-governmental organisations,” SKOP’s treasurer, Dominik Kalweit, said.

“This is happening in a climate where funding opportunities for civil society organisations are already very limited. Furthermore, the MCCF is not registered with the Commission for Voluntary Organisations, which per se raises questions concerning its eligibility to raise public funds.”

The Malta Community Chest Fund organises the annual charity telethon l-iStrina during Christmas. Through this scheme, businesses which donate over €2,000 to the Malta Community Chest will be entitled to a tax rebate, with half of their donations qualifying as ‘business expenses’.

Finance Minister Edward Scicluna appealed to Maltese companies to “take on social responsibility” and donate to the MCCF, whose proceeds largely go towards helping people living in poverty and financing the treatment abroad of people suffering from serious illnesses. However, several voluntary NGOs are less than happy with this.    

Richmond Foundation CEO Antoinette Shah described this scheme as “discriminatory” to other NGOs. “It would also benefit NGOs if the amount of donations would start from a lower denomination of around €500, as not all companies are in a position to donate sums of €2,000 and over,” Shah added.

In a joint statement, human rights NGOs Jesuit Refugee Services, aditus Foundation, and the Jesuit Centre for Faith and Justice, strongly urged the government to extend the tax rebate to donations to all NGOs.

“There is no doubt that MCCF does sterling work. However, it would be excellent if the same benefit could be extended to all NGOs. Many of us also offer indispensable services and support to people who would otherwise go without, complementing and supporting government services, which are often overstretched and unable to meet the needs on the ground.

“All of us struggle to sustain our services and depend on public support to be able to do so. Extending the proposed benefit to all NGOs would be a clear sign of support for our work and an affirmation of the important contribution we give to society.”

Environmental NGO Din l-Art Helwa’s president, Simone Mizzi, said that her organisation has been lobbying for companies which donate to cultural heritage to be recognised with an increase of the current tax rebate to 50% or more.

“A precedence has now been set which we hope will apply to benefactors of NGOs in other fields of activity. Moreover, the same tax benefits should also be made available to individuals who wish to donate, and not just to companies.”

Friends of the Earth chairperson Martin Galea de Giovanni agrees with her. “The rebate should apply to all NGOs registered with the Voluntary Organisation Commission and be open to every individual donor, not just to companies. This is the norm in many EU countries and the United States.”

SOS Malta, which provides help to the poor, and the Mission Fund were also vocal in their displeasure at this scheme.   “It’s a good initiative but it definitely should be extended to donations made to other voluntary NGOs,” SOS Malta’s CEO Claudia Taylor-East said. “NGOs form part of the third sector, the civil society, and they benefit immensely from such fiscal incentives.”

“The Mission Fund, and many other NGOs, also work towards taking social responsibility and towards the millennium goal of eradicating poverty,” Mission Fund’s secretary, Charles Decelis said.

BirdLife Malta’s CEO Steve Micklewright that if the government is going to offer tax rebates on donations made to one organization, it should do so for all of them.”

The government could now find itself facing a difficult decision – to leave the tax rebate scheme as it is and have several popular NGOs feel discriminated against, or to extend this scheme to appease them and potentially find themselves using up more public funds. The Nationalist Party believes that they should go for the latter option.

“The PN believes that any tax rebate tied to donations should not be exclusively for one entity, but apply to all donations to NGOs and charitable institutions,” MPs Claudette Buttigieg and Tonio Fenech said. “We appeal to the government to review the scheme.”