NGOs to perish without assigned tax

MANY NGOs in Slovakia fear they will end up penniless if the government cancels a rule allowing firms to assign 2 percent of their income tax to NGOs.

The Finance Ministry has proposed the change in order to gain more resources for the state budget to finance the government's election promises.

Instead of to the NGO sector, the taxes that until now have been assigned to selected NGOs by firms would henceforth go directly to the state budget.

The ministry says that the revenues arising from the assigned tax are not significant, and that the measure itself is non-systematic and is often abused. Under the rule, companies can set up their own NGOs and donate two percent of their taxes to themselves.

But activist Helena Woleková of the SOCIA foundation says that cancelling the possibility for firms to donate two percent of taxes to NGOs will be a catastrophe for the third sector.

In 2005, the two percent provision brought NGOs a total of Sk930 million, of which Sk618 million came from companies.

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