Funding of Public Benefit Activity with 1% of Personal Income Tax Scheme: Empirical Research

Mamcarczyk, Mariola; Zieniuk, Paweł

Abstract

Purpose: This article seeks to assess the scale of using the funds from Poland’s 1% of personal income tax scheme in the funding of public benefit activity conducted by public benefit organizations in the area of promotion of sports and physical culture. Moreover, it attempts to establish the determinants of revenues from this source earned by individual organizations.
Design/Methodology/Approach: The article presents the results of own research based on a sample of 100 random public benefit organizations. Research conclusions are formulated based on the literature and legislation review, data from the financial statements and technical reports of selected organizations, and statistical methods selected to verify the formulated hypotheses.
Findings: The revenues earned by the organizations from the 1% scheme do not depend on conventional factors, such as organization coverage, the number of beneficiaries, and the persons involved in the activity of the organization or duration of public benefit activity.
Research limitations/Implications: The model developed for research purposes considers no immeasurable factors that may affect the amount of earned revenues, such as recognizability of organization in the society or taxpayer loyalty.
Originality/Value: Our research pioneers the issue of determinants of funds acquired by the organizations from the 1% scheme. Research conclusions can be regarded as a voice in the discussion on the sources of funding the operation of foundations and associations.

Keywords

public benefit organizations (1)foundations (1)associations (2)1% of income tax (4)technical report (1)

References

Act (2003) of 24 April 2003 on public benefit activity and voluntary work. Journal of Laws of 2019, item 688. [Google Scholar]
Anheier, H.K., Toepler, S., and Sokolowski, W. (1997). The implications of government funding for non-profit organizations: three propositions. International Journal of Public Sector Management, 06/1997, Volume 10. https://doi.org/10.1108/09513559710166057. [Google Scholar]
Aschari-Lincoln, J. and Jager, U.P. (2016). Analysis of Determinants of Revenue Sources for International NGOs: Influence of Beneficiaries and Organizational Characteristics. Non-profit and Voluntary Sector Quarterly, 45(3). https://doi.org/10.1177/0899764015595721. [Google Scholar]
Bater, P., Hondius, F. and Kessler Lieber, P. (2003). The Tax Treatment of Ngos: Legal, Fiscal and Ethical Standards for Promoting NGOs and their Activities. Hague: Kluwer Law International. [Google Scholar]
Carroll, D.A. and Stater, K.J. (2008). Revenue diversifications in nonprofit organizations: Does it lead to financial stability? Journal of public Administration Research and Theory, 19. https://doi.org/10.1093/jopart/mun025. [Google Scholar]
Chang, C.F. and Tuckman, H.P. (1996). Revenue diversification among nonprofits. The International Journal of Voluntary and Nonprofit Organizations, 5. [Google Scholar]
Charycka, B. and Gumkowska, M. (2019). Kondycja organizacji pozarządowych 2018. Warsaw: Klon/Jawor Association. [Google Scholar]
Civil Society Organization Sustainability Index (2019). US Agency of International Development, Bureau of Democracy, Conflict and Humanitarian Assistance, Center of Excellence on Democracy, Human Rights and Governance, 22nd Edition. [Google Scholar]
Coleman, A. (2018). Attraction and Retention of Individual Donor Funding in Nonprofit Organizations. ProQuest Dissertations Publishing. [Google Scholar]
Dyczkowski, T. (2015). Mierniki dokonań organizacji pożytku publicznego. Możliwości i ograniczenia stosowania. Prace Naukowe Uniwersytetu Ekonomicznego we Wrocławiu, 398. [Google Scholar]
https://doi.org/10.15611/pn.2015.398.13. [Google Scholar]
Fischer, R.L., Wilsker, A., and Young, D.R. (2011). Exploring the revenue mix of non-profit organizations. Does it relates to publicness? Non-profit and Voluntary Sector Quarterly, 40(4). https://doi.org/10.1177/0899764010363921. [Google Scholar]
Garcia-Rodriguez, I., and Romero-Merino, M.E. (2020), Financing nonprofit organizations. New York, NY: Routledge. https://doi.org/10.4324/9780429265419. [Google Scholar]
Halperin, D. (2006). Income Taxation of Mutual Nonprofits. 59 Tax Law Review, 133. [Google Scholar]
Herring, B., Gaskin, D., Zare, H., and Anderson, G. (2018). Comparing the Value of Nonprofit Hospitals’ Tax Exemption to Their Community Benefits. The Journal of Health Care Organization, Provision and Financing, 55. https://doi.org/10.1177/0046958017751970 [Google Scholar]
Michalski, G. (2012). Operating cycle and nonprofit organizations efficiency. Economics, Management, and Financial Markets, 7(4). [Google Scholar]
Ministry of Finance (2018). Informacja dotycząca kwot 1% należnego podatku dochodowego od osób fizycznych przekazanych organizacjom pożytku publicznego w 2018 roku (z rozliczenia za 2017 rok). Warsaw: Department of Income Tax. [Google Scholar]
Misiewicz, E.I. (2013). The influence of changes in personal income tax regulations on donating non-profit organization. Optimum. Studia Ekonomiczne, 5(65). https://doi.org/10.15290/ose.2013.05.65.05. [Google Scholar]
Moore, D., Hadzi-Miceva, K., and Bullain, N. (2008). A comparative overview of public benefit status in Europe. The International Journal of Not-for-Profit Law, 11(1). [Google Scholar]
Muciek, A. (2012). Wyznaczanie modeli matematycznych z danych eksperymentalnych. Wrocław: Oficyna Wydawnicza Politechniki Wrocławskiej. [Google Scholar]
National Freedom Institute (2018). Informacja dotycząca wydatkowania przez organizacje pożytku publicznego środków finansowych pochodzących z 1% podatku dochodowego od osób fizycznych. Warsaw: Centre for Civil Society Development. [Google Scholar]
National Freedom Institute (2019a). Base of financial statements and technical reports of public benefit organizations. https://sprawozdaniaopp.niw.gov.pl/ (1.10.2019). [Google Scholar]
National Freedom Institute (2019b). List of public benefit organizations entitled to receive 1% of personal income tax. https://niw.gov.pl/opp/wykaz-opp/ (1.10.2019). [Google Scholar]
Parsons, L.M. (2007). The impact of financial information and voluntary disclosures on contributions to not-for-profit organizations. Behavioural Research in Accounting, 19. https://doi.org/10.2308/bria.2007.19.1.179. [Google Scholar]
Waniak-Michalak, H., and Zarzycka, E. (2013). Czynniki wpływające na wybór organizacji pożytku publicznego przez darczyńców indywidualnych w Polsce –czy dane finansowe mają znaczenie? Zeszyty Teoretyczne Rachunkowości, 74(130). [Google Scholar]
Young, D.R. (2007). Financing nonprofits putting theory into practice. Lanham, Md.: AltaMira Press. [Google Scholar]
Zieniuk, P. (2012). Źródła finansowania działalności pożytku publicznego w Polsce. Analiza zmian w latach 2005–2010. Zeszyty Naukowe Polskiego Towarzystwa Ekonomicznego, 12. [Google Scholar]
Zieniuk, P. (2019). Wykorzystanie systemu zwolnień podatkowych dla organizacji pożytku publicznego w praktyce polskich fundacji i stowarzyszeń. In: W. Skoczylas and K. Kochański (eds.) Rachunkowość jako źródło informacji na potrzeby zarządzania wartością przez interesariuszy. Szczecin: Scientific Publishing House of the University of Szczecin. [Google Scholar]

Full metadata record

Cite this record

APA style

Mamcarczyk, Mariola & Zieniuk, Paweł (2020). Funding of Public Benefit Activity with 1% of Personal Income Tax Scheme: Empirical Research. (2020). Funding of Public Benefit Activity with 1% of Personal Income Tax Scheme: Empirical Research. Central European Management Journal, 28(4), 86-106. https://doi.org/10.7206/cemj.2658-0845.36 (Original work published 12/2020AD)

MLA style

Mamcarczyk, Mariola and Zieniuk, Paweł. “Funding Of Public Benefit Activity With 1% Of Personal Income Tax Scheme: Empirical Research”. 12/2020AD. Central European Management Journal, vol. 28, no. 4, 2020, pp. 86-106.

Chicago style

Mamcarczyk, Mariola and Zieniuk, Paweł. “Funding Of Public Benefit Activity With 1% Of Personal Income Tax Scheme: Empirical Research”. Central European Management Journal, Central European Management Journal, 28, no. 4 (2020): 86-106. doi:10.7206/cemj.2658-0845.36.

Copyright info

CC-BY

[1] Act (2003) of 24 April 2003 on public benefit activity and voluntary work. Journal of Laws of 2019, item 688. [Google Scholar]

[2] Anheier, H.K., Toepler, S., and Sokolowski, W. (1997). The implications of government funding for non-profit organizations: three propositions. International Journal of Public Sector Management, 06/1997, Volume 10. https://doi.org/10.1108/09513559710166057. [Google Scholar]

[3] Aschari-Lincoln, J. and Jager, U.P. (2016). Analysis of Determinants of Revenue Sources for International NGOs: Influence of Beneficiaries and Organizational Characteristics. Non-profit and Voluntary Sector Quarterly, 45(3). https://doi.org/10.1177/0899764015595721. [Google Scholar]

[4] Bater, P., Hondius, F. and Kessler Lieber, P. (2003). The Tax Treatment of Ngos: Legal, Fiscal and Ethical Standards for Promoting NGOs and their Activities. Hague: Kluwer Law International. [Google Scholar]

[5] Carroll, D.A. and Stater, K.J. (2008). Revenue diversifications in nonprofit organizations: Does it lead to financial stability? Journal of public Administration Research and Theory, 19. https://doi.org/10.1093/jopart/mun025. [Google Scholar]

[6] Chang, C.F. and Tuckman, H.P. (1996). Revenue diversification among nonprofits. The International Journal of Voluntary and Nonprofit Organizations, 5. [Google Scholar]

[7] Charycka, B. and Gumkowska, M. (2019). Kondycja organizacji pozarządowych 2018. Warsaw: Klon/Jawor Association. [Google Scholar]

[8] Civil Society Organization Sustainability Index (2019). US Agency of International Development, Bureau of Democracy, Conflict and Humanitarian Assistance, Center of Excellence on Democracy, Human Rights and Governance, 22nd Edition. [Google Scholar]

[9] Coleman, A. (2018). Attraction and Retention of Individual Donor Funding in Nonprofit Organizations. ProQuest Dissertations Publishing. [Google Scholar]

[10] Dyczkowski, T. (2015). Mierniki dokonań organizacji pożytku publicznego. Możliwości i ograniczenia stosowania. Prace Naukowe Uniwersytetu Ekonomicznego we Wrocławiu, 398. [Google Scholar]

[11] https://doi.org/10.15611/pn.2015.398.13. [Google Scholar]

[12] Fischer, R.L., Wilsker, A., and Young, D.R. (2011). Exploring the revenue mix of non-profit organizations. Does it relates to publicness? Non-profit and Voluntary Sector Quarterly, 40(4). https://doi.org/10.1177/0899764010363921. [Google Scholar]

[13] Garcia-Rodriguez, I., and Romero-Merino, M.E. (2020), Financing nonprofit organizations. New York, NY: Routledge. https://doi.org/10.4324/9780429265419. [Google Scholar]

[14] Halperin, D. (2006). Income Taxation of Mutual Nonprofits. 59 Tax Law Review, 133. [Google Scholar]

[15] Herring, B., Gaskin, D., Zare, H., and Anderson, G. (2018). Comparing the Value of Nonprofit Hospitals’ Tax Exemption to Their Community Benefits. The Journal of Health Care Organization, Provision and Financing, 55. https://doi.org/10.1177/0046958017751970 [Google Scholar]

[16] Michalski, G. (2012). Operating cycle and nonprofit organizations efficiency. Economics, Management, and Financial Markets, 7(4). [Google Scholar]

[17] Ministry of Finance (2018). Informacja dotycząca kwot 1% należnego podatku dochodowego od osób fizycznych przekazanych organizacjom pożytku publicznego w 2018 roku (z rozliczenia za 2017 rok). Warsaw: Department of Income Tax. [Google Scholar]

[18] Misiewicz, E.I. (2013). The influence of changes in personal income tax regulations on donating non-profit organization. Optimum. Studia Ekonomiczne, 5(65). https://doi.org/10.15290/ose.2013.05.65.05. [Google Scholar]

[19] Moore, D., Hadzi-Miceva, K., and Bullain, N. (2008). A comparative overview of public benefit status in Europe. The International Journal of Not-for-Profit Law, 11(1). [Google Scholar]

[20] Muciek, A. (2012). Wyznaczanie modeli matematycznych z danych eksperymentalnych. Wrocław: Oficyna Wydawnicza Politechniki Wrocławskiej. [Google Scholar]

[21] National Freedom Institute (2018). Informacja dotycząca wydatkowania przez organizacje pożytku publicznego środków finansowych pochodzących z 1% podatku dochodowego od osób fizycznych. Warsaw: Centre for Civil Society Development. [Google Scholar]

[22] National Freedom Institute (2019a). Base of financial statements and technical reports of public benefit organizations. https://sprawozdaniaopp.niw.gov.pl/ (1.10.2019). [Google Scholar]

[23] National Freedom Institute (2019b). List of public benefit organizations entitled to receive 1% of personal income tax. https://niw.gov.pl/opp/wykaz-opp/ (1.10.2019). [Google Scholar]

[24] Parsons, L.M. (2007). The impact of financial information and voluntary disclosures on contributions to not-for-profit organizations. Behavioural Research in Accounting, 19. https://doi.org/10.2308/bria.2007.19.1.179. [Google Scholar]

[25] Waniak-Michalak, H., and Zarzycka, E. (2013). Czynniki wpływające na wybór organizacji pożytku publicznego przez darczyńców indywidualnych w Polsce –czy dane finansowe mają znaczenie? Zeszyty Teoretyczne Rachunkowości, 74(130). [Google Scholar]

[26] Young, D.R. (2007). Financing nonprofits putting theory into practice. Lanham, Md.: AltaMira Press. [Google Scholar]

[27] Zieniuk, P. (2012). Źródła finansowania działalności pożytku publicznego w Polsce. Analiza zmian w latach 2005–2010. Zeszyty Naukowe Polskiego Towarzystwa Ekonomicznego, 12. [Google Scholar]

[28] Zieniuk, P. (2019). Wykorzystanie systemu zwolnień podatkowych dla organizacji pożytku publicznego w praktyce polskich fundacji i stowarzyszeń. In: W. Skoczylas and K. Kochański (eds.) Rachunkowość jako źródło informacji na potrzeby zarządzania wartością przez interesariuszy. Szczecin: Scientific Publishing House of the University of Szczecin. [Google Scholar]

Central European Management Journal