Now was not the time: CCVO responds to reversal of Charitable Donation Tax Credit reduction
April 21, 2015 – Premier Prentice announced today his position that a Progressive Conservative government would not be moving forward with the Charitable Donation Tax Credit reduction that was included in the Provincial Budget tabled on March 26, 2015. The Liberal, New Democratic, and Wildrose parties have also stated they would reverse this decision.
Calgary Chamber of Voluntary Organizations (CCVO) is pleased that Alberta’s charitable tax incentive will remain intact, especially in light of the province’s current economic conditions.
“CCVO has been researching the state of Alberta’s nonprofit and charitable sector since 2009. We have learned that when the economy slows, all forms of revenues for charities drop. We were concerned about the impact of both a slowing economy and this Charitable Donation Tax Credit reduction on the ability for charities to sustain their work.” said Geoff Braun, CCVO’s Director of Policy and Research.
CCVO developed the www.nowisnotthetime.ca in partnership with Volunteer Alberta and Edmonton Chamber of Voluntary Organizations to inform Albertans and Alberta charities about this issue. CCVO applauds all of the individuals, organizations and community leaders who made their voices heard.
Now is NOT the Time
When Alberta’s 2015 budget was introduced on March 26, it included a 39% reduction to the charitable tax credit for total donations over $200.
The bottom line is that now is not the time to be making it more difficult for charities to raise funds.
Budget 2015 asks Albertans to pay more in taxes and fees at a time when many will have reduced earnings. Less disposable income means less money available to donate to charity.
When the economy slows, all forms of revenue for charities are reduced. Alberta charities are already seeing reductions in corporate donations and government funding continues to stagnate. At the same time, many charities are called upon to respond to increased community needs.
The tax credit reduction follows on the heels of the elimination of the Community Spirit Donation Matching program, which was also designed to incent charitable giving.
Much of the fundraising that occurs in Alberta augments government funding. It helps cover the shortfall in funding for programs delivered on behalf of government. It also contributes hugely to capital campaigns for community infrastructure.
Charities use donations to leverage money from grants that require matching dollars.
There are no measures in the Province’s Fiscal Plan to offset reductions in charitable giving resulting from the elimination of this tax incentive.
The 2015 Budget reduces the Charitable Tax Credit from 21% to 12.75% for donations totaling $200 or more, moving Alberta’s rate from the second highest to the third lowest in all the provinces and territories.
Given the difficult economic times and the important work that charities perform in our province, the bottom line is that we should not be making it more difficult for them to raise funds.
We understand the use of charitable tax credits is complex and that economists struggle to evaluate the cost-benefit of tax credits versus direct government support. However, decreasing the charitable donation tax credit at this time simply adds to the challenges experienced in a slowing economy.
We believe it is ill-advised to alter the current framework as we head into an economic slowdown.
Now is NOT the time.
Contact your MLA, Finance Minister Campbell, and Premier Prentice. Talk to your local MLA candidates.
Send your submission to elected officials to firstname.lastname@example.org and we’ll post it to this website.
Open Letters and Letters to the Editors
Valerie Pruegger, Ph.D. – Open Letter to Premier Prentice (PDF – April 16)
Muttart Foundation – Letter to Premier Prentice (PDF – April 10)
Melissa From – Open Letter to Bruce McAllister, MLA(PDF – April 15)
Association of Fundraising Professionals – Open Letter to the Premier (April 15)
Drache Aptowitzer – Erosion of the Alberta Advantage – (April 7)
Cheryl Hamelin – Open Letter to Christine Cusanelli, MLA (PDF – April 3)
Brian Foster, Operation Eyesight – Blog Post (PDF – March 31)
Liberals urge Prentice to rethink rollback on charity tax credit, Global News, April 10.
Government to monitor rates of charitable giving, Robin Campbell, PC candidate for West Yellowhead, president of the Treasury Board and minister of finance, Edmonton Sun, April 15.
Conservative budget spares business, hits charities, Gary Lamphier, Edmonton Journal, April 13
Prentice says government open to changes on charity tax credit rollback, James Wood, Calgary Herald, April 15