By: Vanessa, Xiao Jing, Geraldine (Research and Training Department)
In this month’s publication, we refer to the extension of tax deductions for donations as mentioned in Budget 2021. Due to the global pandemic, there has been very few donations made to charitable organisations. In response, the government has implemented 3 key measures to uplift non-profits amidst these challenging times:
Firstly, the government has offered tax incentives in the form of tax deductions, where donations are made to institutions of a public character (IPCs). Announced by our Deputy Prime Minister and Finance Minister, Mr Heng Swee Keat, the 2.5 times (250%) tax deductions on donations made to IPCs will be further extended for another 2 years until 2023.
Next, the government has committed to continue their support for prominent fundraising community organisations like Tote Board’s Enhanced Fund-Raising Programme, Community Chest, and Change for Charity Grant. For instance, support for Tote Board’s Enhanced Fund-Raising Programme will be made available for another year. Non-profit organisations can hence expect to receive dollar-for-dollar matching up to $250,000 on eligible donations raised from projects in 2021.
Lastly, beyond financial support, there is also a growing awareness that corporate volunteerism is crucial. The Business and IPC Partnership Scheme has hence also been made available till the end of 2023, where businesses can claim 250% tax deductions on qualifying expenditure when they send their employees to volunteer. By introducing tax incentives that encourage volunteerism, the government hopes to create a vibrant social landscape where individuals, businesses and charities can work hand in hand to enact meaningful social changes.
In conclusion, with the massive disruptions caused by the pandemic, it is imperative that the government continues to support these organisations. In dark times, it is even more crucial that these charities stand tall, for only then can they support the victims of the pandemic, and effect changes that inspire a nation.