A study has analysed levels of philanthropic freedom in 13 countries across the world. Philanthropic Freedom: A Pilot Study aims to help countries identify policy changes that will encourage philanthropy. It examines the barriers and incentives for individuals and organisations to donate resources to social causes.

Researchers at the Center for Global Prosperity (CGP) at the Hudson Institute in Washington DC gave countries a score based on ease of registration of a civil society organisation (CSO), domestic tax policies for deductions, credits and exemptions and the ease of sending and receiving cash and in-kind donations across borders. The countries included in the pilot are Australia, Brazil, China, Egypt, India, Japan, Mexico, the Netherlands, Russia, South Africa, Sweden, Turkey and the United States.

The researchers found a better than expected picture of philanthropy in emerging economies, such as India, South Africa and Mexico, which have all implemented policies that promote a healthy civil society and provide tax deductions for donors. However, Egypt, Russia and China showed the most restrictive practices due to the governments’ interference in civil society activities and cross-border flows.

The Netherlands, the United States and Australia had the highest ranked tax incentives to encourage philanthropy. However, the Netherlands does not have a high tax incentive for individuals. It scored highly because of the tax exemptions available for CSOs.

In some countries, where the philanthropic sector is emerging, there is a reported lack of public trust in civil society organisations. Thus, laws and policy will need to be accompanied by good governance to enhance public trust and confidence.

CGP now wants to expand the research to include a total of 50 countries, creating a full Index of Philanthropic Freedom. This will allow it to compare regions and extrapolate trends. The ultimate goal is to encourage government officials to use the index for policy decisions on philanthropy and civil society.

The report is available at www.hudson.org/PhilanthropicFreedom