NO.059

RELEASE OF CHARITIES DEFINITION EXPOSURE DRAFT

I am today announcing the release of an exposure draft of legislation

defining a charity for the purposes of all Commonwealth legislation.

The intention to legislate a definition was announced as part of the

Government’s response to the Report of the Inquiry into the Definition

of Charities and Related Organisations, in my press release of 29 August

2002.

The legislative definition of a charity closely follows the definition

that has been determined by over four centuries of common law, but will

provide greater clarity and transparency for charities. It explicitly

allows not-for-profit child care available to the public, self-help bodies

that have open and non-discriminatory membership and closed or contemplative

religious orders that offer prayerful intervention for the public, to

be charities.

The legislation is expected to begin on 1 July 2004.

I have referred the draft legislation to the Board of Taxation for consultation

with the charitable sector. I have asked the Board to report back to

the Government by the beginning of December 2003. The terms of reference

for the Board’s consultations are attached. The Board will shortly make

available the details of their consultation process.

I encourage interested parties in the charitable sector to provide submissions

to the Board of Taxation.

Further details, and the exposure draft, will be available on the Board

of Taxation website at

www.taxboard.gov.au.

CANBERRA

22 July 2003

Contact: David Alexander

02 6277 7340

TERMS OF REFERENCE

Consultation by the Board of Taxation on the definition of a charity

1. The Government has announced that it will codify the existing common

   law meaning of a charity and expand it to encompass certain child

   care organisations, self-help bodies and, closed or contemplative

   religious orders.

   Pursuant to this decision, the Board is to consult on the workability

   of the legislative definition of a charity proposed in the exposure

   draft Charities Bill 2003.

2. In addition, the Board should specifically consult on whether the

   public benefit test in the Charities Bill 2003 should require the

   dominant purpose of a charitable entity to be altruistic, as recommended

   by the Report of the Inquiry into the Definition of Charities and

   Related Organisations.

3. The Board should consult primarily with organisations intended to

   fall within the new definition of a charity.

4. The Board should consider views put forward and provide its recommendations

   in a report to the Government by 1 December 2003.