NO.062

Release of the Report of the Charities Definition Inquiry

I am releasing today the Report of the Inquiry into the Definition of Charities

and Related Organisations.

The Inquiry, announced by the Prime Minister on 18 September 2000, was asked

to provide options to the Government for enhancing the clarity and consistency

of the existing definitions of charities and related organisations in Commonwealth

law and administrative practice that are appropriate for the social and economic

environment of Australia. Charities are currently defined by reference to 400

years of case law stemming from a 1601 Act of Queen Elizabeth I.

I would like to thank the Committee for the significant contribution they

have made to simplifying what is a complex legal and administrative issue. The

members of the Inquiry were Mr I.F. Sheppard AO QC (Chair), Mr Robert Fitzgerald

AM and Mr David Gonski.

The Inquiry consulted widely among charities and related organisations. It

received more than 370 submissions and held consultations in Sydney, Melbourne,

Brisbane, Perth and Canberra.

The Inquiry has undertaken a thorough analysis of the current approach to

defining a charity and the implications of that definition for the day-to-day

operations of modern charities and has recommended a new approach.

To provide clearer guidance to charities, administrators and courts, the Inquiry

recommends that the definition of a charity be set down in legislation and that

a framework based in a statute four centuries old be replaced by reference to

a list of charitable purposes that provides both broad categories of charitable

purpose and some specific charitable purposes. The Inquiry also recommends a

definitional framework that would distinguish altruistic entities from other

non-profit entities.

The Government will carefully examine the recommended changes to the definition

of a charity. Adoption of the definitional framework recommended by the Inquiry

could have implications for the taxation treatment of charities and related

entities. The Government will give careful consideration to the most appropriate

way to consider these matters.

Taking forward some of the recommendations may also require consultation with

the States and Territories.

The Report can be obtained from the Australian Government Publishing Service

and is available on the internet site http://www.cdi.gov.au/.

CANBERRA

24 August 2001

Contact: Niki Savva

02 6277 7340