This research is focused on the concept of corporate charitable donation. The thesis aims at exploring the different tax policy considerations that should be taken into account by decision-makers throughout the globe in the design of philanthropic regimes that are adjusted to the specific temporal and geographicidio syncrasies. On the other hand, this work also intends to stimulate donation’s social functions for the fulfilment of critical societal challenges and needs. It aims to provide a research breakthrough in legal and policy analysis, allowing the superation of the current paradigm which is still mainly grounded on the understanding that any measures associated with donations are exceptional, qualifying as an incentive orbenefit which does not really belong to the structural features of a sound tax regime. The thesis is based on the understanding that corporate charitable donations are evolutive. They are pre-regulatory realities grounded in social, behavioural, conduct, moral and ethical and even religious elements. This factor needs to be takeninto account in the design of any philanthropic regime. Also, the research aims to allow a paradigm shift from an altruistic-based approach to a functional approach. This research departures from the fundamental premise that a disposal should be considered a corporate charitable donation depending on the societal functions achieved. As such, a donation will exist as long as a disposal contributes to the reduction of charitable shortages, to further social integration, to widespread values or to raise awareness of social issues, even if there is no animus donandi. This allows viewing donations as intrinsically bilateral relations, with benefits arising for both donee and donor. There is certainly a material/physical dimension in most donations. However, and breaking with some traditional approaches, this thesis acknowledges that there is also an important immaterial dimension, as many charitable donations have effects at the level of habits, knowledge, and/or personal development of community members (e.g. cultural development). The acceptance of this imaterial facet is a first step towards an understanding of giving practices as bilateral relations, with benefits for both parties. Corporate donors, simply by participating in thephilanthropic relationship, become exposed to a setting that allows them to be beneficiaries of their own donations (e.g. by donating to a museum, donors become exposed to a cultured setting).In addition, the charitable donations’ societal functions go far beyond reducing shortages of charitable supplies. By allowing strengthening relationships between donors and charitable beneficiaries, donations also contribute to social integration, bringing together social classes and different segments of society. They also contribute to the dissemination of core societal values and principles worthy of protection and raise awareness of social issues that otherwise could remain unknown. Moreover, in the current state of development, the survival of modern corporations depends on their social integration with the communities with which they interact. Anti-social behaviours tend to be frowned upon by the community and affect business. Thus, donations must be seen as an instrument of comunal integration that allows corporate donors to demonstrate their social concerns to their customers, and even to their collaborators and employees. Even if counter-intuitive, corporate donations should not be seen as a conundrum but rather perceived as instruments allowing corporations to pursue their business objectives, meeting social conventions and commercial practices and, in a nutshell, potentiate a corporate’s search for profit. Considering all of the above, this dissertation suggests a tax concept of corporate charitable donation and describes how corporate philanthropic regimes should be designed from a tax policy perspective. The proposal is a particularly broadminded one in terms of eligible objects, namely by sustaining the admissibility of in-kind donations, notably volunteer work or assignments of use. It also recommends expanding the scope of beneficiaries, being them be individuals or other for-profit entities. Driven by the need to maximise the business objectives underlying most corporate charitable donations, the proposal describes whicheconomic benefits can be derived from giving practices that do not disqualify the donation (by constituting a consideration). The impact of international law on the design of domestic philanthropic regimes is also considered by this research. The case law Court of Justice of the European Union on cross-border donations is critically reviewed, in a way that allows for a wider reading of the Courts’ rulings. Despite the limitations, the thesis clearly points out that Member-States retain much more leeway than traditional doctrine recognises, particularly in the inclusion of certain territorial features. Despite the absence of international law instrument regulating the subject matter, the dissertation provides new insights on the function and limits emerging from the non-discrimination provisions included in most tax treaties. Among others, those provisions clearly point in the direction of requiring a mandatory deduction of corporate charitable donations in a significant number of cases. As in any regime, prevention of abusive practices and the fight against the traditional veil of suspicion hovering over the use of resources by charities are also aconcern. As such, a cross-checking methodology is suggested. Accordingly, both donor and donees should contribute to control the accurateness of the elements to be taken into account for the production of any legal and tax entitlements. Based on the understanding that charitable deductions/credits should mostlybe seen as structural features of each tax system, the dissertation suggests the elimination of any tax incentives or benefits from philanthropic regimes (e.g. incremental deductions).In conclusion, this thesis aims at leading to a new understanding of the concept, role and functions of corporate charitable donations. Besides its theoretical merits, this new understanding is used as the basis for the discussion of the tax policy elements that should be used by decision-makers, throughout the world, in the design of new philanthropic regimes. Their revision in the light of the coordinates providedby this dissertation is crucial since it allows, on the one hand, reconciling this regime with constitutional imperatives and, in the other hand, allows strengthening the roleof corporate charitable donations in the construction of better communities and societies.
| Date of Award | 17 Jun 2021 |
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| Original language | English |
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| Awarding Institution | - Universidade Católica Portuguesa
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| Supervisor | João Félix Pinto Nogueira (Supervisor) |
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