Research by a charity information center is forecasting private
foundations in China will overtake government and non-governmental
organizations to become the main source of charity in the
country.
Sponsored jointly by the Ministry of Civil Affairs and other
charity groups, the China Charity Information Center said in its
newly-released report that as the number of private charity
foundations increases, they will play an indispensable role in the
country's charity activities. With the advent of a new enterprise
income tax law, enterprises' charity donations of less than 12
percent of its total annual earnings will be tax free, instead of
the three percent under the former provisional regulation.
The great acceleration of the increased percentage will
encourage more enterprises to dabble in charity, such as the Narada
Foundation, set up in May with a initial capital of 100 million
yuan (13.8 million U.S. dollars).
In five years, the most influential foundations in China will be
private foundations, the report quoted an expert as saying.
Also, because of a national joint promotion from governments
across the country and keen media publicity, citizens' charity
enthusiasm is highly motivated; more people, such as artists or
celebrities, tend to donate money or establish their own
foundations.
In 2006, Chinese pop diva Faye Wong and her husband, Li Yapeng,
launched the Yan Ran Angel Foundation. It was named after their
daughter and aimed to help children with cleft palate under 14
years. The couple donated one million yuan to start the foundation
in collaboration with the Red Cross Society of China (RCSC).
In the next three to five years, as government control on the
private foundation enrollment loosens, a large number of private
foundations will be established with capital of millions.
Also, as more favorable and convenient policies are made in
local areas, the number of local foundations will increase.
In the eastern Jiangsu Province, there were 81 foundations at
the end of 2006, up 92.9 percent compared with 2005. In addition,
some foundations in Shanghai and Jiangsu have capital exceeding
hundreds of millions.
In recent years, private foundations have expanded quickly. By
the end of 2006, China had 795 public foundations, up 3.1 percent
year-on-year and 349 private foundations, up 71.1 percent year-on
year.
In addition, the number of private foundations has exceeded that
of public ones in Beijing, Tianjin, Jiangsu, Gansu, Fujian and
Hainan.
Launched in 2007 and lasting for three months, the research was
based on 2006 statistics about the operation of China's 204 charity
foundations. The spot check included 51 nationwide charity
foundations and 153 local ones, with 92 private and 112 public
foundations.
In China, foundations are divided into two types: public
foundations, which can raise funds from the public, and private
foundations, which may not take public donations but rely entirely
on funding from individuals or organizations.
According to the newest China Charity Information Center data,
at the end of September, the country has 1,245 foundations with
total capital exceeding 10 billion yuan and annual capital
collection of more than eight billion yuan.
(Xinhua News Agency January 20, 2008)