Legal and tax incentives supporting activities of NGOs in the EU countries

The conference stated that tax and legal issues create important framework for work of NGOs. At the European level there are big differences between legal systems and regulation (both public and self regulation) in-between EU 27 following the historical, political and cultural development. At the European level there is still big difference in between the civil society development of CEE countries and Western Europe. The Western Europe is developed enough to organize NGO sector as self regulating, but in CEE countries it might still be dangerous to build the system on self regulation because of the overall lower trust of the society to third sector. The conference recommends to set a basic framework of harmonization of legislation and standards of NGOs operations at the European level to support transparency and accountability, which are crucial for sector development. The regulations should rise in bottom up process from the initiative of NGOs, with the support of national governments. The EU role should be in the facilitator of processes at the national level.

A key difference in relation to the concept and regulation of the NGO sector is between the “charity” concept of common law and the “public benefit” concept of continental law. The Key policy question of nowadays is how to design a public benefit status, what is the “minimal standard”, how to balance benefits and obligations. It is the crucial question which will direct the NGO sector to its independence and transparency or bigger dependence on state. It would be supportive for NGOs when EU would regulate that NGOs in EU countries may have commercial activities and equal treatment within EU of NGOs delivering public services will also be step forward.

The lesson we can take from up to 12 years existence of 1–2 % tax assignation is that it can help in the transition process to switch to more traditional forms of philanthropic giving. The divers mix of support of effective functioning of one of the key sector of economy, whose importance as an employer might in the time of crises even grow, is crucial. The tax assignation can work as temporary complementary tool.