Difference between revisions of "South Africa NGO Sector"
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The Department of Social Development (before 2000, known as the Department of Welfare) oversees NGO registration and NGO affairs. Its goal is to “ensure the provision of comprehensive social protection services against vulnerability and poverty within the Constitutional and legislative framework, and to create an enabling environment for sustainable development” (DSD 10). Within the department, the National Development Agency (NDA) provides funding and capacity building to civil society organizations (CBOs, NGOs, FBOs, etc.) (DSD 15). | The Department of Social Development (before 2000, known as the Department of Welfare) oversees NGO registration and NGO affairs. Its goal is to “ensure the provision of comprehensive social protection services against vulnerability and poverty within the Constitutional and legislative framework, and to create an enabling environment for sustainable development” (DSD 10). Within the department, the National Development Agency (NDA) provides funding and capacity building to civil society organizations (CBOs, NGOs, FBOs, etc.) (DSD 15). | ||
| − | NGOs may register through the Directorate of Nonprofit Organisations, which was created in 1997. Registration is not required, but until recently only registered organizations were eligible for tax benefits. Once registered, organizations must send annual reports of their activities along with financial statements to the Directorate (NPO Act 18,1). | + | NGOs may register through the Directorate of Nonprofit Organisations, which was created in 1997. Registration is not required, but until recently only registered organizations were eligible for [[How to obtain tax-exempt status|tax]] benefits. Once registered, organizations must send annual reports of their activities along with financial statements to the Directorate (NPO Act 18,1). |
| − | Several important changes have taken place recently with respect to the legal framework and tax benefits for NPOs in South Africa. After | + | Several important changes have taken place recently with respect to the legal framework and tax benefits for NPOs in South Africa. After Apartheid ended in 1994, the nonprofit sector was hit hard when foreign donors redirected their funding away from civil society and towards the state. It was in this context that the NPO Tax Lobbying Campaign arose, in an effort to bring about a more financially enabling environment for the nonprofit sector (Nelson 2.2). In 1999, the Commission of Inquiry into Certain Aspects of the Tax Structure of South Africa (known as the Katz Commission) released a report focusing on taxation of NPOs in South Africa. The report called attention to flaws in the existing tax legislation and made suggestions to improve the fiscal environment for NPOs. The Non-Profit Partnership, an NGO working on behalf of the nonprofit sector, seized the opportunity to lobby for legislative changes that would expand tax benefits to encompass a broader range of organizations. |
These developments led to the passage of the Taxation Laws Amendment Act in 2000, which introduced a new term, “Public Benefit Organization” (PBO). To register as a PBO, an organization must be a charitable trust, Section 21 company, or voluntary association, and qualify as a nonprofit organization under the Nonprofit Organisations Act; this includes a broad range of organizations. However, whereas NPOs must be established for an as-yet-undefined “public purpose,” PBOs go one step further in carrying out “public benefit activities” (PBAs), which are defined as activities “…of a philanthropic and benevolent nature, having regard to the needs, interests and well-being of the general public.” (Income Tax Act 30,2). At least 85 percent of these activities, measured in cost or in time spent, must benefit persons in South Africa. Finally, at least one of the following must be true: | These developments led to the passage of the Taxation Laws Amendment Act in 2000, which introduced a new term, “Public Benefit Organization” (PBO). To register as a PBO, an organization must be a charitable trust, Section 21 company, or voluntary association, and qualify as a nonprofit organization under the Nonprofit Organisations Act; this includes a broad range of organizations. However, whereas NPOs must be established for an as-yet-undefined “public purpose,” PBOs go one step further in carrying out “public benefit activities” (PBAs), which are defined as activities “…of a philanthropic and benevolent nature, having regard to the needs, interests and well-being of the general public.” (Income Tax Act 30,2). At least 85 percent of these activities, measured in cost or in time spent, must benefit persons in South Africa. Finally, at least one of the following must be true: | ||
| − | #the organization’s activities must benefit, or be accessible to, the public at large, “including any sector thereof (other than small and exclusive groups)” | + | #the organization’s activities must benefit, or be accessible to, the public at large, “including any sector thereof (other than small and exclusive groups)” |
| − | #the organization’s activities must benefit, or be easily accessible to, the poor and disadvantaged | + | #the organization’s activities must benefit, or be easily accessible to, the poor and disadvantaged |
#the organization must receive at least 85 percent of its funding from donations, grants from state bodies, or foreign grants (Income Tax Act 30,1). | #the organization must receive at least 85 percent of its funding from donations, grants from state bodies, or foreign grants (Income Tax Act 30,1). | ||
Revision as of 11:54, 13 August 2008
Contents
- 1 History of the Nonprofit Sector in South Africa
- 2 Size and Scope of the Nonprofit Sector
- 3 Definitions and Legal Classifications
- 4 Legal Issues and Regulations on the Formation and Operation of Nonprofits
- 5 State-NGO Relations and the Future of Civil Society in South Africa
- 6 External Links
- 7 References
History of the Nonprofit Sector in South Africa
The nonprofit sector in South Africa has a long history. The beginnings of civil society arose during the colonial period with various religious, cultural, and welfarist community-based groups. In addition, the European colonial powers brought their own organizations with them from the seventeenth through the nineteenth centuries (Swilling and Russell 67). During the twentieth century, the nonprofit sector developed further through a corporatist pact between the British elite and Afrikaner middle class (Swilling and Russell 68). Large, formalized non-governmental organizations (NGOs) dealing with health and social services emerged for the exclusive care of the white community. At the same time, grassroots community-based organizations arose in the black community in order to provide basic services. These groups were often survivalist and stood in opposition to segregation and later Apartheid. For the most part, the white-run government tolerated these organizations, except during periods of active political repression like the 1960s.
In the early 1980s, anti-Apartheid civil society organizations grew as a result of President P.W. Botha’s liberalization of the political system. Nonetheless, his reform movement retained repressive elements, and the state-civil society relationship throughout the 1980s remained adversarial, with a hostile legal and financial environment for NGOs (Habib 675-77). Oppositional social movements spawned by community-based organizations were integral in bringing about the end of Apartheid in 1994.
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