CCBE Comments on Possible European Foundation Statute
The Council of Bar and Law Societies of Europe (CCBE) recently submitted comments to the European Commission regarding the possible establishment of a European Foundation Statute that would help overcome some of the legal and tax-related obstacles that currently exist in cross-border nonprofit operations and activities.
Among the current challenges in European cross-border nonprofit activity is the lack of uniformity in defining the concept of a nonprofit (referred to in Europe as a “foundation”), which creates obstacles to cross-border recognition of nonprofit status. There are also a number of tax-related obstacles due to the differences in tax treatment of charitable organizations in different European states. The most significant tax-related challenge highlighted by the CCBE is that current tax rules only allow donors of a charity’s state of domicile to enjoy tax-exemption benefits for their donations. A uniform set of rules could create tax incentives for donations made to foundations established in other European states, as well as standardize the tax benefits across all the states.
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