Donations and Tax : : the Corporate Conundrum.

• Superior document: IBFD Doctoral Series ; v.63
• Author: dos, Leonardo Marques.
• Place / Publishing House: Amsterdam : : IBFD Publications USA, Incorporated,, 2022.; ©2022.
• Year of Publication: 2022
• Edition: 1st ed.
• Language: English
• Series: IBFD Doctoral Series
• Physical Description: 1 online resource (557 pages)

This book focuses on the concept and functions of corporate charitable donations, exploring the tax policy factors to consider in the design of philanthropic regimes.

Table of Contents

Cover -- IBFD Doctoral Series -- Title -- Copyright -- Acknowledgements -- Preface -- Foreword -- Note to Readers -- List of Abbreviations -- Part I: Introduction -- Chapter 1: The Conundrum -- 1.1. Gifts and donations as a pre-regulatory reality -- 1.2. The subjective benefits of giving -- 1.3. From individuals to corporations -- 1.4. Overcoming the conundrum: A roadmap of the thesis -- Chapter 2: Scope and Objectives -- 2.1. Terminology and descriptive methodology -- 2.2. Object -- 2.3. Goals of the book -- 2.4. Sequence -- Part II: Donations, Governments and Corporations -- Chapter 3: Charitable Donations and Public Policy -- 3.1. The need for regulation in corporate charitable donations and its underlying justification -- 3.1.1. Initial approach -- 3.1.2. Government and market shortages -- 3.1.2.1. The need to respond to shortages of charitable supplies -- 3.1.2.2. Charitable supplies: Material and immaterial -- 3.1.3. Corporate charitable donations as a democratic exercise of promotion of social integration, awareness and socially accepted values -- 3.1.4. Prevention of abuse and reduction of suspicion -- 3.1.4.1. Donor abuse and suspicion regarding abusive practices -- 3.1.4.2. Depletion of public and private resources and distortion of competition -- 3.1.5. Constitutional and international law requirements -- 3.1.6. Reduction of the volume of corporate charitable donations and specific charitable practices -- 3.2. The tax system as an efficient regulatory or policy instrument -- 3.2.1. Introductory notes -- 3.2.2. The tax system and regulatory purposes -- 3.2.3. The underlying rationale of the charitable deduction: A unified theory of corporate charitable donations -- 3.2.4. Rethinking the qualification of philanthropic regimes as tax incentives or tax benefits -- 3.2.5. Exceptionality vis-à-vis structural provisions.

3.2.6. Business expenses without a consideration/reciprocation -- 3.2.7. The efficiency of the tax system as a regulatory or policy instrument -- 3.2.7.1. The need for philanthropic regimes as tax frameworks applicable to charitable donations -- 3.2.7.2. The use of the tax system to respond to shortages of charitable supplies -- 3.2.7.3. Corporate charitable donations and happiness -- 3.2.7.4. Corporate charitable donations, social integration and awareness of social issues -- 3.2.7.5. Corporate charitable donations and the promotion of socially accepted values -- 3.2.7.6. Corporate charitable donations and democracy -- 3.2.7.7. The tax system, the prevention of abuse and the need for neutrality -- 3.3. Additional elements -- Chapter 4: Donations and Corporations -- 4.1. Donations as a business tool -- 4.1.1. Introduction -- 4.1.2. A closer relationship between corporations and charities -- 4.1.2.1. Initial approach -- 4.1.2.2. The benefits of corporate social responsibility -- 4.1.2.3. Corporate social responsibility and charitable donations -- 4.2. New philanthropic models -- 4.2.1. Personal preferences and strategic philanthropy -- 4.2.2. New approaches to philanthropy: The new role of charities in today's societies -- 4.3. The economic benefits of corporate charitable donations -- 4.3.1. Corporate giving motivations -- 4.3.2. Motivational case studies -- 4.3.2.1. Philanthropy and patronage as evolving concepts: Effects on donor's motivations -- 4.3.2.2. Motivations -- 4.3.2.2.1. Social convention and commercial practices -- 4.3.2.2.2. Marketing, advertising, overall promotion, networking and public acknowledgement -- 4.3.2.2.3. Whitewashing and greenwashing effects: Halo effect -- 4.3.2.2.4. Motivational instrument towards human resources and head-hunting strategies -- 4.3.2.2.5. Acknowledgement of the quality and necessity of charitable services.

4.4. The financial benefits of corporate charitable donations -- 4.5. Deterrents -- 4.5.1. Lack of benefits -- 4.5.2. Emotional and physical fatigue and forced giving or lack of involvement -- 4.5.3. The belief that there is no obligation to donate more -- 4.5.4. Scepticism, distrust and lack of transparency as to the use of the funds donated -- 4.5.5. Lack of alignment with beneficiaries and/or charitable purposes -- 4.5.6. Lack of time -- 4.5.7. Unfavourable tax framework -- Part III: Legal Constraints on the Design and Drafting of Philanthropic Regimes -- Chapter 5: The Impact of Constitutional and International Law -- 5.1. Constitutional law constraints -- 5.1.1. Introductory notes -- 5.1.2. Obligation to implement philanthropic regimes and the legal qualification of reliefs -- 5.1.2.1. The ability-to-pay principle: Business-driven donations -- 5.1.2.2. Tax base refinements and mandatory features of the tax system -- 5.1.3. Constitutional restrictions on philanthropic regimes -- 5.1.3.1. Restrictions based on equality -- 5.1.3.2. Restriction of social rights -- 5.2. Corporate charitable donations and international law -- 5.2.1. Initial approach -- 5.2.2. The territorial link of philanthropic regimes -- 5.2.3. EU primary law -- 5.2.3.1. From Stauffer to Persche -- 5.2.3.2. The importance of the substitutive effect of charities regarding governmental functions -- 5.2.3.3. Acceptable cases of territorial restrictions in the ECJ's case law: From Stauffer to X -- 5.2.3.4. The roadmap for territorial restrictions -- 5.2.3.5. Charitable donations to third countries under the free movement of capital -- 5.2.3.6. The object of the donations -- 5.2.3.7. The concept of consideration: The court's contribution -- 5.2.3.8. State aid -- 5.2.4. Tax and estate, inheritance and gift treaties -- 5.2.4.1. Tax Treaties and cross-border corporate charitable donations.

5.2.4.2. The deductibility non-discrimination provision: Application to corporate charitable donations -- 5.2.5. Globalization and law -- Part IV: Tax Policy and Design: In Search of a Balanced Framework -- Chapter 6: How Governments Should Draft Their Philanthropic Regimes -- 6.1. A design and drafting methodology -- 6.2. Four essential questions -- 6.3. The five fundamental premises -- 6.3.1. First premise: Clarity as to the function, purpose and significance of each provision -- 6.3.2. Second premise: Societal sensitivity -- 6.3.3. Third premise: The acknowledgement that donations are multi-functional instruments -- 6.3.4. Fourth premise: A balance between the achievement of charitable functions and the prevention of out-of-system situations -- 6.3.5. Fifth premise: Efficiency -- 6.4. An absolute need to obtain further information -- 6.5. The concept of corporate charitable donations -- 6.5.1. Features of the concept -- 6.5.2. Meaning of voluntary and final transfer -- 6.5.2.1. Freedom to donate: The sliding scale -- 6.5.2.2. A final transfer -- 6.5.2.2.1. Non-refundable nature of corporate charitable donations -- 6.5.2.2.2. Conditions -- 6.5.3. The object of the donation -- 6.5.3.1. Admissible donation objects -- 6.5.3.2. Non-monetary donations -- 6.5.3.2.1. Overview of the existing issues -- 6.5.3.2.2. In favour of in-kind donations -- 6.5.3.2.3. Regulatory models and ways of dealing with existing issues -- 6.5.3.2.4. The proposed solution to the appraisal of in-kind donations -- 6.5.3.2.5. Specific cases -- 6.5.3.2.5.1. Usufruct, partial interest and other assignments of use -- 6.5.3.2.5.2. Auctions and discounts -- 6.5.3.2.5.3. Debt forgiveness and free loans -- 6.5.3.2.5.4. Volunteer work -- 6.5.3.2.5.5. Donation of services tout court -- 6.5.3.2.5.6. Donations of inventory -- 6.5.4. The appraisal of in-kind charitable donations.

6.5.4.1. Introduction and proposed approach: The fair market value -- 6.5.4.2. The relevance of the appraisal method suggested -- 6.5.4.3. Meaning of fair market value -- 6.5.4.4. Fairness to the donor -- 6.5.4.5. The donor's ability to pay -- 6.5.4.6. A balance between neutrality and the achievement of charitable functions: Non-monetary and monetary donations -- 6.5.4.7. A potential double-dip effect: The case of assets subject to a fast depreciation rate -- 6.5.4.8. Safe harbours -- 6.5.4.9. Simplification measures: Official quotationsor other official values -- 6.5.5. Parties to corporate charitable donations -- 6.5.5.1. The baseline -- 6.5.5.2. Charitable donations from a financial standpoint: A multilateral relationship -- 6.5.5.2.1. First approach: A non-legal/non-tax perspective -- 6.5.5.2.2. Donors and beneficiaries -- 6.5.5.2.3. Taxpayers and governments -- 6.5.5.2.4. Shareholders and customers -- 6.5.5.3. Charitable donations from a tax standpoint: A bilateral relationship -- 6.5.5.3.1. The baseline -- 6.5.5.3.2. The first and second parties -- 6.5.5.3.3. The third and fourth parties -- 6.5.5.3.4. The fifth party -- 6.5.5.4. The donors -- 6.5.5.4.1. The criterion to qualify as a corporate donor -- 6.5.5.4.2. Donors' motives and profiles -- 6.5.5.5. Beneficiaries -- 6.5.5.5.1. Eligible beneficiaries and the allocation to charitable purposes -- 6.5.5.5.2. Legal entities v. individuals -- 6.5.5.5.3. Legal personality -- 6.5.5.5.3.1. Suggested approach: Existence of tax personality -- 6.5.5.5.3.2. Ring-fenced parts of a legal entity as eligible beneficiaries -- 6.5.5.5.4. The profitability profiles -- 6.5.5.5.5. Eligibility requirements: Approval of projects and name-by-name lists -- 6.5.5.5.6. Residency of the beneficiary -- 6.5.6. Charitable functions and charitable purposes -- 6.5.6.1. Introductory notes.

6.5.6.2. Eligible charitable purposes.