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Imagine Canada’s stretch plan

The world is not ending if you see an increased emphasis on charitable giving at Christmas. That’s been a tradition since Dickens wrote A Christmas Carol.
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The world is not ending if you see an increased emphasis on charitable giving at Christmas. That’s been a tradition since Dickens wrote A Christmas Carol.

Appeals for donations come out at this time of year because now is when they’re most effective. Here’s a hint gained from years of experience as a fundraiser: the dismal month of February and the glorious month of June (just before families head off for their vacations) are tough months for non-profits to raise money.

Even so, although Canadians are always generous at Christmas, there never seems to be enough, and there will always be a charity or agency worried that this year’s fundraiser will fail, leaving services short of money.

That’s a question regarding society’s larger social contract. Just how much are comfortable people obligated to ease the pain or despair of their neighbours? What is the minimum standard of living below which we will not allow our neighbours to fall? At what point does it become solely the job of concerned individuals to assist people beyond what governments are willing to do?

There is a constant conversation between governments and non-profits regarding who is obligated to do what to help the poor, sick and disabled. The most recent loud statement in Alberta came when Ed Stelmach created the Community Spirit program, which matched tax dollars to individual (but not corporate) gifts to non-profits.

That program has saved many community support programs that would have withered and died without it.

Because of Community Spirit, only in Alberta is it possible for individual donors to recover up to half the value of charitable gifts, combining federal and provincial refunds on your tax form. But you have to give more than $200 a year to claim it.

That’s not a problem in Alberta, where half of donors claim donations on their tax forms of $370 or more per year. Calgary holds the prize for the highest annual median gift: $390.

Imagine Canada, a non-profit that reports on the non-profits, has been pushing for a couple of years for a new program to boost the federal payback an extra 10 per cent — for those who stretch their charity muscles.

It’s called the Stretch Tax Credit. If the federal government buys into the program (they didn’t in their last budget), people who set a personal record for charitable giving will recover an extra 10 per cent of their gifts (above their previous record, but less than $10,000 — so that means almost all of us) as a federal tax refund.

Nobody has ever tried this before — this is a new statement in the conversation government has with the non-profits. But Imagine Canada figures if donations below the $10,000 cutoff increased five per cent, it would add more than $400 million in new money for charities.

At most, the Stretch Tax Credit would cost the government $40 million in extra refunds.

That’s a pretty efficient payback — and a far better rate of return than the government got for bailing out corporations during the last recession. Not to mention that every cent of the $400 million (plus the total of all charitable giving) is spent locally at the very bottom of the income ladder (remember, only money flows uphill).

And it’s reasonable to assume the vast majority of the $40 million in tax refunds gets spent locally as well (if the argument works for tax cutters, it must work for tax refunders, too).

We fund health care for all, regardless of income, out of taxes. Our taxes pay for welfare and disability supports, plus a variety of other government-delivered assistance programs.

Anything above government minimums is up to the non-profits — with government assisting their efforts, too.

What’s your responsibility? What incentives would move you to a personal best?

Greg Neiman is an Advocate editor.