SHOULD THOSE GIVING GIFTS TO ENVIRONMENT GROUPS HAVE TAX DEDUCTIBILITY?

The Standing Committee on the Environment in the Australian House of Representatives (which is dominated by Coalition MPs) recently established an inquiry into the tax deductible status of environmental organisations.

This is being widely seen as an attempt by the Federal Coalition Government to limit the ability of conservation groups ( particularly the larger ones such as Greenpeace, the World Wildlife Fund for Nature, the Wilderness Society and the Nature Conservation Council of NSW) to campaign against developments which threaten the health of the natural environment.

The inquiry was set up in response to lobbying from the mining industry and various mining lobby groups such as the Minerals Council.  These groups  are concerned about the effective campaigns environment groups are running against unsustainable developments such as the Galilee Basin coal proposals, the Abbot Point development adjacent to the Barrier Reef and coal seam gas mining in NSW and elsewhere. These mining interests and various Coalition MPs claim that environment groups should only have tax deductible status if they are engaging in on-the-ground environmental activities such as tree planting and bush regeneration. 

There are almost 600 environmental organisations on the Register of Environmental Organisations under the Income Tax Assessment Act 1997.

Apparently the inquiry has been deluged with submissions supporting the retention of the tax deductible status of environmental organisations.

 The Clarence Valley Conservation Coalition's submission to this inquiry is copied below.

Submission to the

Inquiry into the Register of Environmental Organisations

Under the Income Tax Assessment Act 1997

The Clarence Valley Conservation Coalition Inc  (CVCC) believes that the environment groups who are deductible gift recipients (DGRs) should continue to have this status because of the valuable work they perform in protecting the natural environment whether it be through land-care type activities or lobbying  (political or otherwise) or education or a combination of these.

1. Introduction

The CVCC is a community group based in Grafton in the Clarence Valley in the NSW Northern Rivers.  It was formed in 1988 and has been involved with environmental issues – both locally and further afield – since that time.  Like many other small environment groups it does not have tax-deductible status and obtains funding for its activities through membership subscriptions and donations.  Much of its work is done by members volunteering their time and expertise.

2. Environment Groups with DGR Status

However, many environment groups, particularly the larger ones, do have tax-deductibility which assists them to fund their operations in education and lobbying activities as well as hands-on landcare-style activities.  These funds are obviously used for a variety of purposes such as employing staff or commissioning reports, purchasing equipment and stationery and reimbursing travel expenses.

3. Importance of Environmental Protection

These DGR  environmental groups perform a very valuable community service – a service of protecting  the natural environment.  Maintaining a healthy natural environment is vital to humanity as well as to all other species.  

As Kevin Evans, National Parks Association of NSW Executive Officer, pointed out in March this year:  “Healthy ecosystems provide billions of dollars of goods and services essential for the wellbeing of local communities and businesses.  A safe, healthy and sustainable future can only be achieved if we conserve the natural places and ecosystems that provide us with clean air and water and other benefits.”

There are many threats to the maintenance of healthy ecosystems.  These include rising carbon pollution, extensive land clearing, illegal and unsustainable logging, overfishing, water pollution, inappropriate and environmentally damaging development and issues associated with the expansion of coal seam gas and coal mining.  Many of these threats to the natural environment also directly threaten human health or have negative impacts on local communities.

4. Governments and Environmental Protection

If our community could rely on governments and their agencies and legislation to protect them and the natural ecosystems from environmental threats, there would be no need for environment groups such as the CVCC and those who have DGR status to engage in political activities including lobbying of politicians, issuing media releases, writing letters to the media and so on.

Political activity is necessary to raise awareness and to ensure that the needs of the natural environment (which obviously does not have a voice) are placed in the public domain.  It is quite unreasonable to expect that those concerned with environmental protection should button their lips and just meekly do tree-planting and other on-ground activities and ignore threats which will ultimately abrogate their tree-planting efforts.

5. Environment Groups Aid Transparency

Another important function of environment groups is their role in bringing a level of transparency into the public domain about the impacts of major developments that are promoted by industry and often supported by governments which do not always acknowledge (or even recognise) the deleterious impacts these proposed developments may have on the environment or on local communities. The larger environment groups - those with DGR status - obviously have a greater capacity for doing this. Sadly, governments do not always welcome transparency – but, in a democracy, transparency is vital to ensure that government is working in the community interest.

6. The Right to Engage in Political Activity

Any change to the tax deductibility status of DGR environment groups because of their engagement in political activity would go against the High Court decision Aid/Watch incorporate v Commissioner of Taxation 2010.  This case confirmed the right of DGR listed groups to engage in political debate and advocacy.

The  CVCC hopes that this Inquiry will recognise that environment groups perform an invaluable service for the community – and future generations – and acknowledge that those groups which have DGR status should continue to have that status.

ENVIRONMENTALISTS TACKLE GOVERNMENT AND BUSINESS FAILURES

Failure by governments to read public opinion is legendary, and time and again we observe government inaction leading to public reaction. Whether it be to occupy Wall Street; the 'Arab Spring', or the Australian Lock the Gate movement against coal seam gas mining, people increasingly see a need to take matters into their own hands.

When it comes to environmental protection, governments invariably abrogate their responsibilities in favour of the perception of a need for growth. With development and mining lobbies able to spend billions on advertising campaigns, the opposing environment movement, made up predominantly of cash-strapped volunteer groups, finds it almost impossible to be heard.

With no bottomless pit of money to call upon, environmentalists have had to become more inventive, and are now focusing on the 'green' image of peripheral companies. For example, timber giant Gunns' failure, thus far, to fulfill its ambitious pulp mill plan for Tasmania's Tamar Valley is, in no small part, the result of a successful campaign aimed at large financial institutions. The threat to tarnish their environmental image is a powerful tool.

Similarly, Greenpeace has identified the ANZ Bank as the biggest financier of Australia's coal industry, arguably one of the world's largest contributors to climate change. Under pressure, the ANZ has recently rewritten its energy financing policy. However, Greenpeace believes the latest document is deliberately detail-free to allow business as usual, and has vowed to maintain the pressure.

Recent campaigns aimed at Australia's largest furniture retailer, Harvey Norman, over its use of Australian native timber, has successfully focused consumer attention on the environmental costs of native forest logging, This campaign is likely to be extended to other industry players, particularly in relation to the destruction of core koala habitat to feed the voracious needs of the wood-chip industry.

However, despite the old protest song saying, “Times they are changing”, the more things change, the more they seem to stay the same, and 40 years on the struggle to save our iconic natural areas continues.

- John Edwards