Access of foundations to the privileged tax regime of non-profit organisations: proposals for its reform

Abstract

Accomplishing objectives of general interest is not a task exclusive to the State but "is harmonised in a mutual state-society action" (STC 18/1984) where an adequate regulatory framework, in accordance with Law 49/2002 of the Tax Regime of non-profit organisations, is essential in which certain requirements are established to enable foundations, in particular, to access the privileged tax regime it offers. However, the deficiencies in the legislative technique that this regulation presents, the interpretation that the DGT makes of it -based on a position of mistrust towards civil society- and its limited adaptability means that, despite its promulgation over almost twenty years, in the eyes of interested parties this law has little to offer in way of support. Through the study of the aforementioned deficiencies, we highlight the practical translation of these and the impact they have on the performance of the foundations. Also, in support of any future reform of the law, we point out solutions aimed at its revitalisation, while always seeking to maintain the necessary balance between the encouragement of patronage and control of the risk that the tax regime may be abused.