Singapore Markets open in 5 hrs 59 mins

Bad News for Charity on Giving Tuesday

Michael Rainey

“Despite Giving Tuesday and despite all the charitable appeals that almost certainly landed in inboxes, charitable donations by individuals declined by slightly more than 1 percent in 2018, according to figures released this year by Giving USA,” says The Washington Post’s Helaine Olen. “One likely culprit? The Republican and Trump tax ‘reform’ package of 2017. The rich got richer, while many charities took it on the nose.”

The total dollar value of charitable giving rose slightly last year, Olen says, but the increase was driven by large donations from foundations and the wealthy, who tend to support high-status organizations involved in the arts, medicine and education. More mundane organizations such as food banks rely on support from low- and middle-income donors, and that’s where the decline in giving is being felt, according to experts Olen spoke to.

“[T]his sudden dip in what is otherwise a reportedly decent economy leaves many pointing the finger at President Trump’s tax cut,” Olen writes. “When the standard deduction doubled, it eliminated the need for many people to itemize their tax return. The Tax Policy Center estimates that the number of filers itemizing their returns fell from 46 million to 19 million. The change in the law made tax filing easier for many middle-income filers, but it also suddenly eliminated a major incentive to give to charity. If you don’t itemize, you can’t take the charitable deduction.”

Like what you're reading? Sign up for our free newsletter.