NOTICE | It’s time we recognized the value of volunteering. A Simple Tax Code Change Could Help | Radio-Canada News
This column is the opinion of Stephanie Robertson, Founder and CEO of SiMPACT Strategy Group, and Chris Jarvis, Co-Founder and CSO of Realized Worth. For more information on the TBEN Opinion section, please see the FAQ.
In times of crisis – and 2021 has had its share of crises – the power of the voluntary efforts of citizens is often highlighted. Volunteers are both the input and the output of resilient communities. Yet we see in both data from Volunteer Canada and in the recurring stories that nonprofits find themselves doing more with less; and that includes fewer volunteers.
Earlier this month, the United Nations celebrated International Volunteer Day as a time to honor the transformative power of volunteerism in our communities and encourage citizen and government support for volunteerism. This year, Secretary General Antonio Guterres launched a “very specific appeal to all governments to promote volunteering”.
Empty words or meaningful action?
Beyond empty words, governments have powerful levers to encourage community volunteering. In fact, the Canadian government has an opportunity it may not have considered: corporate tax reform may be the catalyst for a resurgence of volunteering in this time of unprecedented need.
France offers us an example to explore. Article 238 bis of the general tax code provides that companies can make donations in kind to associations, including employee volunteering to deliver skills in the service of the common good. These contributions must be made during working hours (which requires the company to have a policy of paid time off for volunteering) and include the provision of pro bono services. Companies can then claim a tax reduction equal to 60% of the salary paid to the employee during this period.
Sodexo, a company of 625,000 employees, recently shared with us its experience of French taxation: “It’s a win-win solution where we can engage employees to do good for local communities, which gives them the sense of action and improve employee retention. . – and is a free source of expertise for NGOs, ”said Nathalie Brindeau, European director of Stop Hunger, a foundation created by Sodexo.
A tax credit translates into action
This tax credit recognizes that the investment of community businesses is not just a question of money; our skills and efforts can be even more meaningful. This would quantify the very real value that Canadian nonprofits receive in skilled volunteer resources.
A localized version of Section 238a in French has the potential to unlock billions of dollars of value for all parties: increased resources for critical operations, meaningful opportunities for employee engagement, and tax cuts for all parties. ‘a government that needs good news with business.
With more skilled volunteers during working hours, nonprofits can offset administrative costs and redirect funds to expand services. As companies seek to modernize their brands by demonstrating purpose, social responsibility, commitment to the United Nations 2030 Sustainable Development Goals and reconciliation, competency-based volunteering programs have the potential to develop. incredible impact.
We believe that Canada’s new parliament can find broad agreement in this approach. In the context of a Liberal Party commitment to increase corporate taxes on banks, for example, it would be an opportunity for corporations to offset any tax increases with tax credits – possibly by reporting on tax increases. volunteer programs already underway in their organization. For example, our audits for RBC, TD and Scotiabank show that their current volunteer programs generate 12,000 to 40,000 volunteer hours per year; valuing those hours as a tax credit has the potential to dramatically increase those numbers and inspire many other businesses to do the same.
Low cost, high reward
The bottom line is still the bottom line, after all. By valuing volunteerism, we take stock of the financial value of doing business that truly improves society. In our opinion, the value created by investing in the community is both desirable and tangible. Rewarding companies that provide skill-based volunteer hours with a tax credit has the potential to significantly increase volunteering and inspire many other companies to do the same.
As well as encouraging community-oriented corporate behavior, this will lead to more formal volunteering across the country, both as employees and as individuals.
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