26 February 2014
The UK should not aspire to a US model of philanthropy and tax
incentives - they are not replicable and are a unique product
of US social, political and historical factors, according to a
report released today.
Although the USA is top of the world for giving, with the
average person giving $694 a year to charity compared to $247
(£148) in the UK, the report debunks the argument that we need a
more American charitable culture.
‘Give me a Break: Why the UK should not aspire to a “US-style”
culture of charitable giving’, released by CAF, also
highlights the barriers to adopting a US culture of giving. It
argues that too much emphasis has been placed on how we can copy
the US rather than developing a uniquely British giving
culture.
Contrary to popular belief, UK tax incentives for giving are
more generous than in the US and less open to abuse or fraud. US
tax deductions are also biased towards those with higher incomes
due to the requirement that those claiming deductions must file an
itemised tax return.
In reality, the US model of philanthropy is not the most
suitable for the UK. Apart from the differences in tax incentives,
donations in the US go disproportionately to religious causes and
higher education (45% in total), whereas UK giving is more spread
across a variety of causes.
The report also highlights how attitudes to wealth and
perceptions of personal wealth are different in the US than the UK,
and can not be easily addressed by policy makers. The US does not
have an organised welfare state equivalent to the UK and has a
historic commitment to the idea of limited government, creating a
fertile space for philanthropically funded programs that the UK
does not have.
The CAF World
Giving Index 2013 found last year that the US was the most
charitable country in the world, with the UK coming in 6th
globally.
The report, the first of a series of discussion papers that CAF
will be releasing throughout the year, argues that we should look
to US levels of giving as a benchmark to aim for, but the methods
the UK uses to achieve this must be different to those used in the
US.
To launch the report, CAF, which promotes charitable giving and
provides financial services and social finance to not-for-profit
organisations, is holding a parliamentary event today (Wednesday)
comparing the culture of charitable giving in the UK and US.
The Minister for Civil Society Nick Hurd MP, the Shadow Minister
(Cabinet Office) Lisa Nandy MP and the report’s author Rhodri Davies, will be speaking.
Rhodri Davies, author of the report and CAF's Policy Manager,
says: “It is fantastic that policy makers are keen to boost levels
of charitable support in the UK, but we must stop obsessing over
why we lag behind the US.
“Each country has different cultural factors which shape
attitudes to giving and the US model isn’t the best fit for the
UK.
“It is important to remember that our tax incentives are amongst
the most generous in the world and British people are incredibly
generous, with 76% giving to charity in a typical month.
“Instead of constantly comparing ourselves to the US or trying
to mimic them, policy makers should be celebrating our healthy
culture of giving and looking for measures to boost giving that fit
well with our society and culture.”
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