Two decades of donation data show Canadians are more Scrooge-like than ever

Twenty years worth of tax data shows that Canadians are becoming increasingly Scrooge-like when it comes to charitable giving.

In 2000, 26 percent of Canadians donated to charity, while only 19 percent opened their wallets in 2020, the most recent year with available data.

The amount of money being donated each year is also falling, with Canadians donating about 0.72 percent of their income in 2006, compared to 0.49 percent in 2020.

The numbers, compiled by the Fraser Institute, show that Manitoba is the most generous province and Quebec is the least generous, based on the percentage of income donated to charity in 2020.

The percentage of donors has been low for nearly two decades, even while Canadians continue to tell pollsters that charities are as important as ever, said Andreae Sennyah, the director of policy at Cardus.

“I think if you spoke to the average person, you’d be hard-pressed to find somebody who doesn’t support the work of charities writ large, in terms of what they say,” said Sennyah.

“I wonder if we have lost the sense of responsibility to support the charities that we say that we care so much about? I think the gap is there. It’s the sense of actual responsibility for our own communities and the role that charities play within them,” she said

At the same time as donations are plunging, Canadians are also increasingly worried that they will have to access charities in the near future.

According to Cardus, about 26 percent of Canadians anticipate that they will access, or are already accessing, the services of a charity this year. About the same number of Canadians say they will likely be donating less this year due to the state of the economy.

Sennyah recommends that Ontario boost its charitable tax credit, which is currently the lowest among Canadian provinces with a 5.05 percent tax credit for the first $200 in donations and an 11.16 percent tax credit for amounts over $200.

By nearly doubling both tax credits and raising awareness among Ontarians about the new benefit, Sennyah believes it has the potential to juice donations in the province at a time when charities are facing the dual challenge of declining donors and an increase in people requesting their services.

And if Ontario is looking for inspiration, or a case study on the impact of boosting these tax credits, it will soon have one. Although Alberta has one of the most generous charitable tax credits in Canada, it will soon be getting bigger.

United Conservative Party MLA Dan Williams saw his private member’s bill to boost his province’s charitable tax credit pass third reading last week.

Williams said he didn’t want to just “tinker” with the tax credit and instead proposed to increase it to 60 percent from 10 percent, in the hopes of significantly boosting charitable giving in Alberta.

Based on data on donations in previous years, Williams expects that the increased tax credit will amount to about $50 million in foregone revenue for the provincial treasury. That number could be even higher if, as Williams expects, the legislation leads to an increase in charitable giving in the province.

Those revenue projections meant that Williams had to have some “long conversations” with Finance Minister Travis Toews about the implications of his bill. Toews, and both sides of the legislature, have been supportive, said Williams, as evidenced by how quickly the legislation was unanimously passed this month.

It’s not a coincidence that the new tax credit, when combined with the federal tax credit, matches the amount that Canadians receive when they make a donation to a political party.

“We as politicians have set our tax refundable receipt for the first $200 in Alberta at 75 percent. That’s exactly what it will be (for all charities) now that we have passed this bill, between the federal and provincial credit combined. And we’re clever, if not self-interested, as politicians, and we know it’s a great way to get people on board early on and get them into that habit of giving,” said Williams.

“But are charities not as important or more important?” he said.

If charitable giving continues to fall, but the services charities provide are still in demand, Sennyah said it’s likely the government will fill the gap, which would take something intangible out of society.

“There’s an unquantifiable element to what charities are able to do. You compare a cheque you get in the mail, compared to someone serving me soup at a soup kitchen. What you and I do at a soup kitchen is completely beyond the scope of what a government can do and what I arguably would say what they should do,” she said.