Mr PASIN (Barker) (17:35): I am pleased to be given an opportunity to make a contribution on this TLAB, the Treasury Laws Amendment (2021 Measures No. 3) Bill 2021, because it will give me the opportunity to speak about something that I am passionate about and have been advocating for for some time in the hope that that modest idea might see itself into a future TLAB—in particular, as it relates to deductible gift recipients. But, before I do, for anyone who might be listening out there on their drive home or somewhere else, TLABs are effectively bills that are grab-bags of Treasury measures that need attention and, in and of themselves, perhaps don’t justify a separate bill.
It’s schedule 5 that I want to go to. Others have made contributions on schedule 5, but, in this TLAB, at schedule 5, which deals with deductible gift recipients, there’s a number of organisations that, as a result of this bill, will be given DGR1 status under the Income Tax Assessment Act 1997. ‘What’s that?’ I can hear people on their ride home asking. It is to do with tax-deductible status. When you make a contribution, you’re often told that donations above two dollars or more will be tax-deductible. That entitlement is only available to entities that have achieved DGR1 status, or deductible gift recipient status. Whilst each of the organisations—not all of which I’m familiar with—I am sure do great work, I want to speak about a group of organisations that fall into a category that I am incredibly passionate about, and they are community foundations.
There were, when I last checked, around 37 or so community foundations around Australia. I need to disclose an interest. I’m particularly passionate about two because they exist in my electorate: the Stand Like Stone Foundation, which exists and does amazing work in the south-east of South Australia, and the Barossa foundation, which, as you might expect, does similarly good work but in and around the iconic Barossa Valley, which is also in the electorate of Barker. Those are only two of the 37 or more community foundations. You might ask: ‘What’s a community foundation?’ Well, the answers are probably as many and varied as the community foundations that there are, but I can speak with some knowledge in relation to Stand Like Stone and the Barossa foundation. They are just, as the name would suggest, community organisations that seek to provide a philanthropic pathway for locals to give locally and for the proceeds of that gifting, that philanthropy, to be delivered locally.
One of the criticisms in regional, rural and remote communities, the likes of which I represent, is often that charitable organisations are headquartered elsewhere; often the charitable organisations deliver services and other things remotely. To be honest, a number of my constituents are very keen to give but to give to a local organisation, where they can see, directly, not just the pathway to the recipient but also the benefits and the dividends from their contribution. Listeners might think, ‘Well, that sounds fantastic!’ and it is, but there are some challenges.
One of those challenges is that community foundations in Australia currently don’t enjoy DGR1 status.
In the case of Stand Like Stone, in my home town of Mount Gambier, ensconced in the Limestone Coast, someone who wants to make a contribution through Stand Like Stone will do so but, unless Stand Like Stone is working hand in glove with a DGR1 charity, they won’t enjoy the tax deductibility. For small donations, that’s perhaps neither here nor there, but those larger corporate contributions are often disincentivised because of the inability to make a tax-deductible exchange. There are ways around this, by jumping through a number of hoops and dealing with significant red tape—time doesn’t permit me to go into the detail—but it still requires the donor to accept that the donation will go out of the community before coming back to the community at the discretion of the DGR1 charity that might be working hand in glove with a local community foundation.
I am passionate about community foundations. The Treasurer, the Assistant Treasurer and others in senior decision-making positions in this place know that I am very keen to see community foundations listed on a future TLAB schedule 5 for deductible gift recipients. I should say that my push hasn’t always enjoyed the support of Philanthropy Australia, the peak body, but it does now. As you would imagine, my push has always enjoyed the support of Australian Community Philanthropy, the community philanthropy peak body, but now it also has the support of the national body with responsibility for those very large philanthropic bodies. We’re on a complete unity ticket and hopefully marching towards that outcome.
I think the best way of highlighting to this place the importance of DGR1 status is to go to a couple of real-life examples that not only show, in this case, Stand Like Stone’s contribution to need in my community but also highlight the limitations that DGR2 status—their status—applies. In the infamous Black Summer bushfires, a community in my electorate, Keilira, was burnt significantly. That took place in December 2019. Stand Like Stone stepped in immediately. They had two community events and raised $9,000 to support and distribute to the fire victims. They say, in correspondence to me, ‘However, had we been able to offer tax deductibility to larger donors, in conjunction with the event, the sum would likely have doubled or trebled. Indeed, we’ve had indications to that effect.’ These are people who had come to an event ready to make a contribution, but when the tax deductibility status was explained to them—as it should be—there were some limitations and, as a result, there wasn’t the level of contribution there could have been to support those fire victims. Again, it’s a case of locals wanting to make a local gift to support a local charitable outcome.
The second example relates to the response to COVID-19. You’ll recall there was a period of extreme lockdown arrangements and we had a number of organisations ensuring that Australians had access to the food they needed. Stand Like Stone were limited in their ability to support these charities. Whilst they were considering a significant contribution, it had to be moderated down as a result of their inability to attract those contributions from corporates in their local community.
I said at the beginning of my contribution there are 37 or so philanthropic organisations. They are spread across Australia and their representation in this place is evenly distributed, I have to say. I have written to all coalition colleagues encouraging them to get on board with this campaign. I encourage others in this place to familiarise themselves with whether they have philanthropic community based organisations in their electorate and, please, join in the campaign to ensure that they are recognised with DGR status. It is a simple request. It makes sense.
I don’t want it to be suggested that community foundations only exist in rural or regional or remote communities. There are some that exist in larger communities, indeed, some even in capitals, and the ACT is a classic example of that. It is a simple concept. Australians are so giving. We are incredibly generous. That generosity is probably piqued when we know our neighbour is in need of support. In communities where these additions operate, there is an opportunity to direct your giving straight from a local organisation to another local in need. It seems silly that we have a distinction between, on average, larger philanthropic organisations based in other places and local community foundations. I hope we can deal with that issue in coming months because I think we will see even greater giving through these community foundations, particularly if we can facilitate it through DGR1 status.