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Charity legislation needs review

It is unacceptable that the big corporate based charities claim  millions in annual income tax exemptions, while small community based and operated non-profit organisations  struggle to gain official charity status, Labour’s acting spokesperson for the Voluntary and Community Sector Louisa Wall says.

“The New Zealand Initiative's latest report, Giving Charities a Helping Hand, claims our laws favour the big players over the small organisations. This is proof that our current charity system in New Zealand has been corporatized.

“As the report says  the Government must provide greater transparency in the charity sector, set clearer rules and processes, and remove the "unfair" tax advantages enjoyed by the for-profit arms of charity groups. 

“Many New Zealanders will be shocked to know that current laws allow the commercial arms of large charities to claim income tax exemptions with little oversight into how much money is passed on for charitable purposes while at the same time smaller charities are struggling to keep  their charity status registered. 

“The degree of separation from the communities in need and those providing this important charitable work means communities throughout New Zealand are missing out.

“We need transparency over who is benefitting from the $16 billion flowing into charities each year. Currently we have ineffective regulations that are undermining the public's trust and confidence in the sector.

“The community is again calling on the Government to review the Charities Act and the definition of what is a charity. It promised to do this in 2010 but hasn’t,” says Louisa Wall.