In August 2008, Philanthropy Ireland and Irish Charities Tax Reform Group commissioned Farrell Grant Sparks Consulting (FGS) to carry out research on tax and regulatory policy to encourage greater charitable and philanthropic giving in Ireland. The research team was led by Greg Sparks and the final report is now available here.

The results suggest, among other key recommendations, to:

• reduce the current threshold above which tax relief may be applied from €250 to a new rate of €175;
• that the tax relief applying to donations to charitable organisations should be decoupled from the provision in the Finance Act 2006 to limit the use of tax reliefs by higher earners;
• extend the provision of tax relief on donations of cash and securities to charity to include donations of property;
• the introduction of a VAT subsidy for charities to compensate for VAT incurred on inputs, similar to the scheme that is currently operating in Denmark where the subsidy is based on the proportion of funds received by the charity from private donations;
• the removal of the two-year waiting period for charities to become eligible to claim tax relief on donations;
• a relaxation of the rule where an individual’s tax relief is restricted to 10% of their income tax where they have an association with the charity.