2022 Budget: Good news for charities
October 2022 | Insights | Anne Robinson, Sarah Ryan
- DGR status to be reviewed
- NFP sector led roadmap for support and strategic direction
The 2022 Budget provides some good news for the charities and not-for-profits sector:
‘In addition the Productivity Commission will review the current framework to incentivise philanthropy in the not-for-profit sector, and the Department of Social Services will work with the not-for-profit sector to develop a sector led not-for-profit blueprint as a roadmap towards providing the not-for-profit sector with support and strategic direction to expand their services in coming years.’
The announcement heralds two important developments. Firstly, and most importantly, the Productivity Commission will conduct a review the way Deductible Gift Recipient (DGR) status is awarded.
This is the most important development in the charities and not-for-profits sector since the publication of the ‘Contribution of the Not-for-Profit Sector Productivity Commission Research Report’ in January 2010. This report estimated the number, size, and impact of the sector in Australia, and while not all its recommendations were implemented, this ultimately led to the formation of the Australian Charities and Not-for-Profits Commission (ACNC).
While we cannot predict all outcomes of this report, it is to be hoped the report will confirm the benefits provided by the sector would offset taxation losses that may occur as a result of significantly broadening access to DGR status for charities. We note the ‘Not-for-Profit Sector Tax Concession Working Group’ recommended in its report delivered in May 2013 that DGR status should be granted to all charities. The impact such a change could have within the sector is profound.
Secondly, the 2022 Budget announced the development by the Department of Social Services (DSS) with the not-for-profit sector of a ‘sector led’ roadmap to provide support and strategic direction ‘to expand their services in coming years’. The outcome of this proposal has the potential to provide greater cohesion in funding models used by both state and federal governments. This would better support charities and not-for-profits in the strategic provision of services in the broader community.
Finally, we can report that Australians for Indigenous Constitutional Recognition has been specifically awarded DGR status. This is a significant win for the charity after its unsuccessful application to the ACNC for Public Benevolent Status.
For more information please contact Anne Robinson AM
 ‘Contribution of the Not-for-Profit Sector Productivity Commission Research Report’, Australian Government Productivity Commission, (January 2010).
 ‘Not-for-Profit Sector Tax Concession Working Group Final Report’, The Australian Government, The Treasury, (May 2013).