27.06.2014 10:04

Сharities as part of the economy

Development charities is also associated with a number of circumstances. First, the charity has become part of business. Secondly, the establishment of charities has a very pragmatic reason – the desire of owners of large personal fortunes to avoid high taxes when transferring inheritance and gift tax. The latter circumstance is the most important and decisive, because it allows large property owners to conceal their wealth from income tax and inheritance tax.

Creating charities, large owners and corporations funded: education (universities, colleges, schools), research institutes, arts centers, churches, various community organizations. Transfer of funds to charities carried out in the form of large cash receipts or shares. In this way charities operate in the capital market, investing in different securities or receiving dividends from securities referred to them, and thus increase their capital.

Passive operations charities consist of charitable receipts in the form of cash and securities, and active – from investments in various securities, including government, as well as in real estate. Most of the assets (over 90%) of the shares and bonds of corporations. Priority in establishing charitable funds belongs to the USA. In this country, they were established before the war on the basis of the largest personal fortunes Carnegie, Ford, Rockefeller and other wealthy families. In subsequent years, the representatives of other major states also began to organize charities. A large number of funds occurred in the southwestern part of the country (California, Texas, Nevada, Louisiana). In the postwar years were set up similar funds in the countries of Western Europe and Japan.

Typically, the charity large bankers and industrialists in the field of education, health, culture, art is used in their interest as the image and advertising. Colleges, institutes and universities are preparing for their money shots, ie human capital, which subsequently brings high profits of large corporations and increases the initial capital donations.

Statistical information about the investment of charitable funds are usually very limited, and sometimes even unavailable. Many funds do not represent statements and are not reported on the structure of their assets. Charitable foundations enjoy greater tax benefits.


For a long time the U.S. charities enjoyed quite significant tax benefits. Only in 1969 were introduced taxes on their activities. Thus, the tax has charged: 4.5% – the market value of assets generating income, 4% – on income from their investments, 5% – on the transactions between charities and its founders.

At the same time, a fairly broad survey of 575 fund activities conducted in the late 60s. Showed that they exist not only through donations and charity.

The data show that 75% of the income funds received by speculation and income from securities (interest and dividends), and the rest – from gifts and other charities. This suggests that charities are active in the securities market and the various transactions associated with buying and selling stocks and bonds.