Australian Tax-Deductible Giving Surges
2 June 2010 at 11:11 am
Australian taxpayers claimed more tax-deductible donations in 2007-2008, surging by 24.5%, despite coinciding with the start of the economic downturn.
The latest analysis from QUT says the total amount donated and claimed as tax-deductible donations in 2007-08 was $2.35 billion compared to $1.89 billion for the previous income year.
This constitutes an enormous increase of $461 million (or 24.5%) from the previous income year.
Director of The Australian Centre for Philanthropy and Nonprofit Studies at QUT,Professor Myles McGregor-Lowndes says the 2007-08 period was the beginning of the recent global financial instability.
While the collapse of the sub-prime mortgage market began in the USA in February 2007, Australian GDP rose to a high of 4.2% in the September quarter 2007 and unemployment fell to a low of 4.1% in the March quarter 2008.
Prof McGregor-Lowndes says Not for Profit organisations did not begin to see significant changes in donor behavior until late in the 2008 financial year.
Each year The Australian Centre for Philanthropy and Nonprofit Studies (ACPNS) at QUT analyses statistics on tax-deductible donations made by Australians in their individual income tax returns to Deductible Gift Recipients (DGRs). The analysis does not include giving by corporate and trust taxpayers, “non-tax contributions” such as raffles, sponsorships, fundraising purchases or volunteering.
The average tax-deductible donation made and claimed by Australian taxpayers to DGRs in 2007-2008 was $523.10 (compared to $440.01 in the previous income year). This average amount is two and a half times that of a decade ago.
In absolute terms there was an increase in individual taxpayers making deductible gifts in 2007-08 (4.48 million compared to 4.28 million in the previous year). However, in terms of percentage of Australian taxpayers making deductible gifts there was a decrease (35.47% for the 2007-08 compared to 36.30% in the previous year).
Prof McGregor-Lowndes says that on average, those individual taxpayers who make tax-deductible donations to DGRs donate approximately 0.43% of their taxable income. This trend has been sustained over the past decade from a starting point of 0.22%.
Although 34.47% of male Australian taxpayers made and claimed tax-deductible donations being 51.24% of the total tax-deductible donations made, 48.76% of female Australian taxpayers claimed tax-deductible donations.
On average, female Australian taxpayers who donate to DGRs give approximately 0.54% of their taxable income compared to 0.35% for Australian males.
Taxpayers in New South Wales claimed tax-deductible donations to DGRs of $1.05 billion in 2007-08. This amount represented almost 49.06% of the national total. The next largest donor state was Victoria, followed by Queensland and then Western Australia. New South Wales taxpayers made and claimed the largest average tax-deductible donation to DGRs of $788.23 compared to the national average of $523.10.
Prof McGregor-Lowndes says the more one earns, the more one claims as a tax-deductible donation. Whilst the average tax-deductible donation was $523.10 in 2007-08, donating taxpayers with a taxable income over $1 million per year claimed an average of $102,543.08 (previous year was $48,548.66) in tax-deductible donations.
This year in New South Wales, Darling Point/Point Piper was replaced by Mosman as the postcode with the highest amount claimed. In Queensland the Gold Coast was replaced by the Sunshine Coast and Noosa as the postcode with the highest total gifts claimed.
Prof McGregor-Lowndes says the top ten occupations by average deductible gift amount is also available with ‘Company representatives – industrial, medical etc’ making a spectacular debut at the number one positions, displacing ‘Coroner; Councilor; Judge-law; Magistrate; Member of parliament; Parliamentarian; State Governer’.
The full report can be found at: http://eprints.qut.edu.au/32290/2/Working_Paper_51_v7_FINAL.pdf