Campaign to encourage philanthropic giving exploits national hostility to tax

Opinion: It is unclear what is so bad about taxation, which provides the funding for our much needed social services

Denis O’Brien listens as former US president Bill Clinton delivers the Ray Murphy Memorial lecture at an evening event organised by the Forum on Philanthropy and Philanthropy Ireland last month: “Would the One Percent Difference campaign not serve us all better by promoting a culture that was better disposed to paying tax?” Photograph: Alan Betson

You can’t poke your head out from under the bedcovers these days without being guilt-tripped by the One Percent Difference campaign. It is suddenly the moment for giving – cash if at all possible, but time if you can’t. The crisis must be over; the troika can rest easy. There are a myriad of “good causes” too, lined up to receive your 1 per cent. All the same, it is hard not to feel a little uneasy.

Click on to the campaign website – onepercentdifference.ie and you will be reassured, again and again that “this is not a tax”. “This is something only you decide on,” the promotional video tells us. “The Government decides where your taxes go. This is yours,” it soothes. What is so bad about taxation, and why the need to undermine this source of funding for much needed public services?

There is a great little game on the website that you can play. It chooses the good causes that best match your particular values. I’d be embarrassed to admit what it threw up for me. Still, you don’t even have to get out of the bed to do your giving, just reach for the laptop.

Look at where the funding for this campaign is coming from. It is predicted to be a €2.5 million campaign over two years. The Department of Environment, Community and Local Government is one core funder. This is the same department that has vigorously and disproportionately cut funding to community groups over the past five years. The sector is predicted to have shrunk by 35 per cent by the end of 2013. Shrinking good causes by 35 per cent with one hand and asking us to give 1 per cent to the same good causes with the other is somewhat contradictory.

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The second core funder is Atlantic Philanthropies. This organisation has provided significant funding to many good causes over the years. Unfortunately it has decided to spend down its funds and will close its operations in the near future. It is predicted that this, along with the departure of One Foundation for the same reason, will leave an annual €60 million hole in the funding available to the social sector. This is a big hole to be filled by anyone's 1 per cent.

Where, we might ask, is all this going? Frank Flannery is chair of the Forum on Philanthropy, the original instigators of this giving campaign. He has also proposed that tax "exiles" should be given incentives to contribute to philanthropy in the form of being allowed to spend extra days in Ireland – an extra day at home for every €36,500 they donate to charity or to small- and medium-sized businesses, up to a total of an extra 62 days a year. Michael Noonan is said to be interested. The needs of our good causes clearly trump any ethical concerns about tax avoidance.

Tax is at the heart of the unease inspired by this campaign. The One Percent Difference video concludes, “It’s been proven. Giving is good for you. So, you are helping yourself too.” But in fact philanthropy has always been good for you taxwise, especially if you’re wealthy. Would rich people not be making a greater contribution to a better Ireland if they paid a higher effective tax rate and traded in some of their many tax exemptions? Would tax exiles not have more to offer by staying home and paying up?

The One Percent Difference campaign is deliberately tapping into our very unhappy relationship with tax. We are not supportive of taxation. We are ambivalent about tax avoidance. Even the generosity implicit in the term "avoidance" is telling.

Charity creates supplicants
Taxation is key to funding the public services so many of us depend on for our wellbeing. These are the services whose inadequacy is a constant source of complaint, and inadequacy is of course inevitable without sufficient funding. Tax is the fairest way we have found to redistribute wealth. Leave it to individual charity and complaints about our public services will continue long into the future.

Would the One Percent Difference campaign not serve us all better by promoting a culture that was better disposed to paying tax? When tax is not available to fund the work of community organisations, we end up with charitable works. The individual donor gets to define what is and what is not a good cause. People no longer hold the right to be authors of their own development, the right to have a say in decisions that affect them. They become supplicants, at the mercy of good works.

In this sense the 1 per cent giving campaign is a form of privatisation. The State is abdicating its responsibility to support excluded voices, to advocate for their interests and to support disadvantaged communities in their efforts to advance their own development. The campaign will not add value to our good causes; it will merely fill some of the gap left as key statutory and philanthropic funders withdraw.

Some organisations are already well-
established as good causes in the eyes of the wealthy. Others will busily transform themselves into good causes to ensure their survival. Many will fail to be seen as good causes and will disappear. This is particularly destructive for those parts of civil society that seek the necessary transformations for a more equal, environmentally sustainable and participative society. Ultimately we all lose out as these voices fall silent.

Niall Crowley works independently on equality issues and is former chief executive officer of the Equality Authority