Labor’s charity tax could gut generosity in Australia
Much like recent changes to superannuation or proposals for taxes on unrealised gains, such meddling erodes confidence. Philanthropists need certainty, not shifting goalposts.
The Albanese government’s plan to force private ancillary funds to distribute more than 5 per cent of their net assets each year risks irrevocably damaging a philanthropic system which, according to Philanthropy Australia, has provided more than $7 billion to charities since its inception nearly 25 years ago.
PAFs – previously known as private prescribed funds – were elegantly designed under the Howard government to support charities in perpetuity by building capital reserves for long-term giving. Now, that future is under threat.
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Deborah Henderson is Deputy Executive Director of the Institute of Public Affairs.
