Australia, draft legislation - "Defining Charity"

Cherished

Silver Meritorious Patron
This is a special bulletin from Joined Up enews seeking your views on a proposed statutory definition of charity


Defining Charity

A modernised statutory definition of charity will provide greater clarity and certainty for charities, the public and regulators in determining whether an entity is charitable. It is therefore central to improving understanding of, and access to, charitable tax concessions.


The Government is seeking your views on a proposed statutory definition, with exposure draft legislation and associated material being released and available on the Treasury website. The public consultation period closes on 3 May 2013 to enable time for the legislation to receive Royal Assent by 1 July 2013.


In releasing the exposure draft legislation, the Government has also announced that the definition’s commencement will be deferred from 1 July 2013 to 1 January 2014 so that the Australian Charities and Not-for-profits Commission has the time it needs to provide guidance and support to the sector.


The draft legislation has taken into account responses to the Government’s 2011 consultation paper, A Definition of Charity. The more than 200 submissions the Government received to the 2011 consultation paper are now available on the Treasury website.


Organisations will be interested to know that the draft legislation preserves the common law definition of charity, including long established principles such as the presumption of public benefit for certain charitable purposes including the advancement of education and religion. It also incorporates recent court decisions, such as Aid/Watch Incorporated v Federal Commissioner of Taxation, which extended the circumstances in which a charity may advance public debate.


Submissions on the exposure draft legislation can be emailed to [email protected].

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Cherished

Silver Meritorious Patron
Making a Submission

Interested parties are invited to comment on the draft legislation and explanatory material. Please note we have incorporated the views of the 2011 submissions into the draft law, so it will not be necessary to submit previous submissions. Due to tight deadlines, early submissions would be appreciated and no extensions can be granted.


While submissions may be lodged electronically or by post, electronic lodgement is preferred. For accessibility reasons, please submit responses sent via email in a Word or RTF format. An additional PDF version may also be submitted.


All information (including name and address details) contained in submissions will be made available to the public on the Treasury website unless you indicate that you would like all or part of your submission to remain in confidence. Automatically generated confidentiality statements in emails do not suffice for this purpose. Respondents who would like part of their submission to remain in confidence should provide this information marked as such in a separate attachment.


Legal requirements, such as those imposed by the Freedom of Information Act 1982, may affect the confidentiality of your submission.


Closing date for submissions: Friday, 3 May 2013


Address written submissions to:


Manager
Philanthropy and Exemptions Unit
Indirect Philanthropy and Resource Tax Division
The Treasury
Langton Crescent
PARKES ACT 2600


Email: [email protected]
For enquiries please call Maria Purnell (02) 6263 3299 .
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RogerB

Crusader
Well done, Cherished. Thanks for staying on top of this.

Off the top of my head and as I think aloud on this, a key component in defining a charity must be that it has NO, repeat no, compulsory payment of "donations" or other exchange in kind as a condition of service or of being a recipient of its public benefit.

This because, by definition, the demand for monies or value in-kind as a condition of being served is not charitable.


My wording here is rough and as I said, off the top of my head . . . But I urge everyone to to recommend this kind of inclusion in the definition of charity to be used by the authorities.

RogerB
 

RogerB

Crusader
More . . . still thinking.

Any organization having a schedule of donations or fees to be paid for or before service is granted automatically disqualifies itself of charitable status.

R
 

RogerB

Crusader
Purple is correct.

In Oz and in the UK when I was there Museums (most) were government run and free entry . . . in the US the two museums I regularly visit have a "suggested Donation" posted but I do know of one offended individual who refused to pay (a frustrated artist Scn type) and entered without payment.

The way one handles this, if one thinks it through, is by noting the distinction between non-profit performance and exhibition societies/association and charities . . . to be noted is the fact that the request for input is on the point of charities that perform services of a public benefit.

Law is a rather specific subject, so specific the mis-reading/misunderstanding the use of a coma cost Rogers Cable Systems in Canada a couple of $million a few years ago.

In the writing of the law defining a charity one would have a "section" that would make the distinction between organizations that requests a suggested or requested donation for an attendance to a performance or exhibition (such as musical societies and museums) and those charitable organizations who perform services for or on demanded fixed fee schedule basis.

That shouldn't be too hard to understand, no?

But then, again, this is Oz we are talking about, not the USA scene.

R
 

FinallyMe

Silver Meritorious Patron
Not to derail here but I think I'm AMAZED -- does Australia actually go directly to the public for input on stuff like this???????? Not to "representatives"? If that's true, I think I'll move to Australia!
 

Purple Rain

Crusader
Purple is correct.

In Oz and in the UK when I was there Museums (most) were government run and free entry . . . in the US the two museums I regularly visit have a "suggested Donation" posted but I do know of one offended individual who refused to pay (a frustrated artist Scn type) and entered without payment.

The way one handles this, if one thinks it through, is by noting the distinction between non-profit performance and exhibition societies/association and charities . . . to be noted is the fact that the request for input is on the point of charities that perform services of a public benefit.

Law is a rather specific subject, so specific the mis-reading/misunderstanding the use of a coma cost Rogers Cable Systems in Canada a couple of $million a few years ago.

In the writing of the law defining a charity one would have a "section" that would make the distinction between organizations that requests a suggested or requested donation for an attendance to a performance or exhibition (such as musical societies and museums) and those charitable organizations who perform services for or on demanded fixed fee schedule basis.

That shouldn't be too hard to understand, no?

But then, again, this is Oz we are talking about, not the USA scene.

R

Here is a bit more from the government website:

KEY FEATURES OF THE DRAFT LAW
• To be a charity an entity must be not for profit, and all charitable purposes must be for the public benefit.
• A charity may have incidental or ancillary purposes (such as fundraising) that may not be charitable in themselves but which aid or further the charitable purposes.
• The Bill retains the presumption of public benefit for the purposes of relieving poverty, advancing education and advancing religion and also specifies the relief of illness and the relief of the needs of the aged to more fully reflect the common law.
• The public benefit provided by a charity may be tangible or intangible.
• An entity with a purpose to promote change to government laws and policy can be charitable, where the purpose is to further or protect one or more charitable purposes.
• Categories of charitable purposes listed in the Bill are:
– advancing health, education, social or public welfare, religion, culture, and the natural environment
– promoting and protecting human rights, preventing or relieving the suffering of animals, and protecting the safety of the general public.
• Specifying these categories does not affect the charitable status of purposes recognised under the common law that are not listed.
• Disaster relief and other charitable funds can now assist in rebuilding the assets of not-for-profit entities after a disaster.
• Funds that donate to charity-like government entities will not lose their charitable status under Commonwealth laws.
• The meaning of Government entity is clarified to assist in distinguishing charities from government entities.

1.22 An entity is a charity if it satisfies the following criteria:
• it is not-for-profit;
• it has only charitable purposes (other than ancillary or incidental purposes that further or aid the charitable purpose) that are for the public benefit;
• it does not have disqualifying purposes; and
• it is not an individual, a political party or a government entity.

I am actually pretty concerned about the religious category. A "religion" is not necessarily a charity at all - see Scientology which the High Court stupidly considered to be a religion. It seems to me that they could easily argue they are "advancing religion". Damn the stranglehold religion has over society. Why do they get special treatment over any other system of beliefs that might be non-religious?

It should not be what a religion is but what a religion does to serve others that counts.

I'm going to put in a submission saying so, even if it's only a paragraph.
 
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Purple Rain

Crusader
Not to derail here but I think I'm AMAZED -- does Australia actually go directly to the public for input on stuff like this???????? Not to "representatives"? If that's true, I think I'll move to Australia!

Oh yes. I've made lots of submissions. Some are basically just quick and dirty emails, whilst others I have worked on with groups of friends such as for issues around education of our kids with disabilities. I have been really upset about things like the coal seam gas mining, though. I guess most of the things I've made submissions about have been environmental lately. Either that or I have just sent an email to the minister or my political representative.
 

RogerB

Crusader
Not to derail here but I think I'm AMAZED -- does Australia actually go directly to the public for input on stuff like this???????? Not to "representatives"? If that's true, I think I'll move to Australia!

Actually, Oz is GREAT! As a citizen you can have as much say and input to government as you are willing to be active.

It actually has a proud, now rather forgotten, history of direct participation in governance by the people for the people. There was a time, in Queensland, where the voters/electorate would put their representatives standing for office under direct written (contractual) instruction on what they wanted representation on as part of the promise upon which votes were sought. This back in the 1930's.

This all is written up in a wonderful book titled: The Money Power versus Democracy by a rather brilliant Ozzie political/economics historian named Eric Butler.

The US has a "consultative period process" in which input from "interested parties" is sought . . . umm, but the only way you get to know WTF is if you plug yourself into the system . . . . and then the public tends to get ignored when the "rules" by which the new laws are implemented are ostensibly written by the "executive branch" of government . . . but actually more often than not by industry lobysts!! :grouch:

But remember when we had the bunch of ESMBers appearing before the Senate Committee downnuda putting them straight? :happydance:

None of the behind doors trick the Yanks pull.

Rog
 

Purple Rain

Crusader
Oh, ok. Here we go:

Advancing religion

1.95 Advancing religion involves the promotion of spiritual teaching and the observances that serve to promote and manifest it. The purpose must be directly and immediately religious and involve various ways of advancing religion, including providing and maintaining facilities for worship; supporting religious clergy; missionary bodies; and religious associations.


1.96 It is not enough that a purpose arises out of or has a connection with a faith, a church or a denomination. If the purpose is not directly or immediately religious it is not charitable. For example, social, recreational or sporting entities are not charitable even if membership is limited to followers of a particular religion.


1.97 It is also not enough that an entity does something merely in the name of religion for it to be a charity advancing religion. A purpose expressed as advancing religion cannot be used as a means of promoting or expressing aims or opinions that are not charitable and would not be for charitable purposes if expressed by a non-religious organisation.

What this all means I do not know for sure, but it seems reassuring. I'm just going to trust that Nick Xenophon et al know what they are doing!

:)
 

RogerB

Crusader
Purple . . . thanks for all these citation and excerpts of the work in progress. This gives us what we can work with to give good and reasoned input to for further inclusions.

Based on what you've posted, I see the boys (and girls) putting this thing together are really giving sensible and complete thought to closing the kinds of loopholes any evil cult like you-know-who would try and climb through.

I still like my idea that any organization that insists upon and demands payment upfront for services based on a fixed schedule of payments . . . whether labelled "donations" or not is not operating in the spirit of nor within the common understanding of the term charity or charitable; and this notion is good and proper to be included in the legislation.

RogerB
 

Purple Rain

Crusader
Purple . . . thanks for all these citation and excerpts of the work in progress. This gives us what we can work with to give good and reasoned input to for further inclusions.

Based on what you've posted, I see the boys (and girls) putting this thing together are really giving sensible and complete thought to closing the kinds of loopholes any evil cult like you-know-who would try and climb through.

I still like my idea that any organization that insists upon and demands payment upfront for services based on a fixed schedule of payments . . . whether labelled "donations" or not is not operating in the spirit of nor within the common understanding of the term charity or charitable; and this notion is good and proper to be included in the legislation.

RogerB

:)

I still like your idea too. But hopefully the good people up on the hill have it covered. Cherished will probably give us more information when she checks on the thread.
 

mnql1

Patron Meritorious
Senator Xenophon's speech in support of the Charities Bill 2013

Australia's Charities Bill 2013 was passed on June 27, 2013. Below is a video of the brief speech by Senator Nick Xenophon during the second reading.

A transcript of the speech is available on the Senate website, in Hansard for June 27, 2013, and on Senator Xenophon's website.

Senator Nick Xenophon said:
It would be remiss of me not to say, in the remaining 20 seconds, that I became interested in this field because I was approached by a number of victims from the Church of Scientology. I believe that all organisations, if they are behaving in an abusive manner, ought to be held to some measure of account. A public benefit test is a useful measure of that.

[video=youtube;79HqiZDRJEs]http://www.youtube.com/watch?v=79HqiZDRJEs[/video]
 
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Free to shine

Shiny & Free
Wow, thanks! The punchline is at the end, and I love the look on his face. He was going to get that in there! :biggrin:

Heard of a scientologist complaining his accountant was saying he couldn't claim his scientology donations ... "But it is a charity!" he wailed ....

I hope there is a huge wake-up soon.
 
Re: Senator Xenophon's speech in support of the Charities Bill 2013

Australia's Charities Bill 2013 was passed on June 27, 2013. Below is a video of the brief speech by Senator Nick Xenophon during the second reading.

A transcript of the speech is available on the Senate website, in Hansard for June 27, 2013, and on Senator Xenophon's website.



[video=youtube;79HqiZDRJEs]http://www.youtube.com/watch?v=79HqiZDRJEs[/video]
So, how have they defined a charity, and have they included transparency of their financial affairs? I know those were important points when they were asking for feedback on the bill. Mimsey
 

Jump

Operating teatime
Re: Senator Xenophon's speech in support of the Charities Bill 2013

So, how have they defined a charity, and have they included transparency of their financial affairs? I know those were important points when they were asking for feedback on the bill. Mimsey

As I understand it, a yearly financial statement has to be posted on the public Charities Commission website.

http://www.acnc.gov.au/
 
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