Not a single non-profit organization could register as a charitable in Kyrgyzstan. The draft law, which proposes to change the current version of the law on charitable organizations, says.
It is noted that non-profit organizations (NPOs), registered in the organizational and legal forms of a public association, foundation or institution, have the right to voluntarily receive charitable status. It gives non-profit organizations the right to tax benefits. But in fact, not a single NGO uses the benefits, since there is not a single charitable organization in the country.
The problem is that the current law provides for too stringent, impracticable requirements for charitable organizations.
«For example, a non-profit organization must allocate 98 percent of its income to charitable purposes, and 2 percent it may spend on administrative needs (office rent, utility bills, office supplies, employees’ salaries) to be recognized as charitable. However, this condition is almost impossible to implement, since no organization will survive on 2 percent of revenues,» a background statement for the draft law says.
The initiators of the amendments, 18 deputies of the Parliament, propose to change the system of work of charitable organizations. So, it is proposed to lift the income restriction of a charitable organization for donations and grants. The authors of the amendments explain this by the fact that the society itself will be able to decide which charitable organization to help on the basis of reports on financial activities.
In this case, a charitable organization can receive income from business activities. The law proposes to lift restrictions on those types of businesses that a charitable organization may be engaged in, but with limited spending on its own needs. The organization will have to donate at least two thirds of the proceeds to fund charity programs.