{"id":167617,"date":"2022-02-10T09:40:21","date_gmt":"2022-02-10T04:10:21","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=167617"},"modified":"2022-02-09T22:41:45","modified_gmt":"2022-02-09T17:11:45","slug":"answered-discuss-the-importance-and-implications-of-tax-incentives-to-philanthropic-entities","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/answered-discuss-the-importance-and-implications-of-tax-incentives-to-philanthropic-entities\/","title":{"rendered":"[Answered] Discuss the importance and implications of tax incentives to philanthropic entities."},"content":{"rendered":"<table style=\"border-collapse: collapse; width: 100%;\">\n<tbody>\n<tr>\n<td style=\"width: 100%;\"><b><span data-contrast=\"auto\">Introduction:<\/span><\/b><span data-contrast=\"auto\"> Briefly define philanthropic entities.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:259}\"><br \/>\n<\/span><b><span data-contrast=\"auto\">Body:<\/span><\/b><span data-contrast=\"auto\"> Write about the importance of providing tax incentives to philanthropic entities. Write the implications caused by the tax incentives.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:259}\"><br \/>\n<\/span><b><span data-contrast=\"auto\">Conclusion: <\/span><\/b><span data-contrast=\"auto\">Give a way forward.<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span data-contrast=\"none\">Philanthropic entities are <\/span><b><span data-contrast=\"none\">non-profit non-governmental entities<\/span><\/b><span data-contrast=\"none\"> that utilize donated resources and income to <\/span><b><span data-contrast=\"none\">provide socially useful services<\/span><\/b><span data-contrast=\"none\">. NGOs, Charitable trusts and community foundation are some examples of Philanthropic entities.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"none\">Tax incentives to philanthropic entities have a long history. However, the relation between tax incentives and philanthropy is complicated.\u00a0<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"none\">Tax incentives are important for philanthropy because of following reasons.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"none\">The <\/span><b><span data-contrast=\"none\">revenue forgone by the state<\/span><\/b><span data-contrast=\"none\">, channelized through philanthropic entities <\/span><b><span data-contrast=\"none\">reaches the remotest areas<\/span><\/b><span data-contrast=\"none\">, where the reach of governance is limited.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"2\" data-aria-level=\"1\"><span data-contrast=\"none\">It creates a <\/span><b><span data-contrast=\"none\">positive perception about philanthropic entities<\/span><\/b><span data-contrast=\"none\">. The revenue forgone by the state suggests that the state supports philanthropic activity.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"none\">It <\/span><b><span data-contrast=\"none\">actively encourages the private sector<\/span><\/b><span data-contrast=\"none\"> to engage with public problems and contribute to the welfare of society.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"2\" data-aria-level=\"1\"><span data-contrast=\"none\">It fills the void created by a lack of manpower or resources with the government to fulfill their obligations of social welfare in every part of the country in a much less expenses.\u00a0<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<p><span data-contrast=\"none\">However, there are several implications of tax incentives to philanthropic entities.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"3\" data-aria-level=\"1\"><b><span data-contrast=\"none\">In many cases, tax incentives<\/span><\/b><span data-contrast=\"none\"> provided to philanthropic entities are <\/span><b><span data-contrast=\"none\">misused to evade taxes<\/span><\/b><span data-contrast=\"none\">, while no concrete work is done on the ground. It has led to mushrooming of several entities that have no concrete credentials.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"4\" data-aria-level=\"1\"><span data-contrast=\"none\">The <\/span><b><span data-contrast=\"none\">idea of tax incentives was appealing when the overall taxation was high<\/span><\/b><span data-contrast=\"none\"> but with reduction in tax rates the appeal of tax incentives has gone down.\u00a0<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"none\">At present the <\/span><b><span data-contrast=\"none\">financial flows coming through tax incentives are not the main source of resources<\/span><\/b><span data-contrast=\"none\"> for civil society.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"2\" data-aria-level=\"1\"><span data-contrast=\"none\">The <\/span><span data-contrast=\"none\">present tax incentive regime has led to<\/span><b><span data-contrast=\"none\"> skewed distribution of NGOs <\/span><\/b><span data-contrast=\"none\">sector wise, where most NGOs are engaged in <\/span><b><span data-contrast=\"none\">health and education<\/span><\/b><span data-contrast=\"none\">.\u00a0<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" aria-setsize=\"-1\" data-aria-posinset=\"3\" data-aria-level=\"1\"><span data-contrast=\"none\">The <\/span><b><span data-contrast=\"none\">geographical distribution<\/span><\/b><span data-contrast=\"none\"> is also skewed where most NGOs are present in states like Uttar Pradesh and North east still lags behind.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<p><span data-contrast=\"none\">The <\/span><b><span data-contrast=\"none\">new tax regime in India gives the option to donors to opt out of incentives for lower tax rates<\/span><\/b><span data-contrast=\"none\">. It may impact the ability of philanthropic entities to deliver services, especially those working in remote areas and lesser recognized sectors.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"none\">There is a lack of research on the impact of tax incentives on philanthropic entities. Given the important role philanthropic entities play, <\/span><b><span data-contrast=\"none\">any change in the state-civil society relation, in terms of incentives, shall be undertaken only after thorough study of its implications<\/span><\/b><span data-contrast=\"none\">.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Introduction: Briefly define philanthropic entities. Body: Write about the importance of providing tax incentives to philanthropic entities. Write the implications caused by the tax incentives. Conclusion: Give a way forward. Philanthropic entities are non-profit non-governmental entities that utilize donated resources and income to provide socially useful services. NGOs, Charitable trusts and community foundation are some&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/answered-discuss-the-importance-and-implications-of-tax-incentives-to-philanthropic-entities\/\">Continue reading <span class=\"screen-reader-text\">[Answered] Discuss the importance and implications of tax incentives to philanthropic entities.<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[139,25,9],"tags":[10634],"class_list":["post-167617","post","type-post","status-publish","format-standard","hentry","category-mains-marathon","category-mains-marathon-answers","category-public","tag-philanthropic-entities","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1703345559},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/167617","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=167617"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/167617\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=167617"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=167617"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=167617"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}