Government Spending Crowds Out Charitable Giving

If the 2003 tax cuts are allowed to expire, the income tax on upper-income taxpayers will increase by 10 percent and the capital gains tax will increase by 33 percent. This is sure to have a negative impact on charitable giving, write former White House aide Scott Walter and Sandra Swirski in a recent legal backgrounder from the Washington Legal Foundation. Households whose wealth exceeds $1 million–7 percent of the population–provide half of all charitable contributions. Walter and Swirski observe that during the boom years 1995-2000 real income per capita increased by 12 percent while household giving increased by 54 percent. But charity will suffer as the economy slows and government deficit spending increases.


Support Capital Research Center's award-winning journalism

Donate today to assist in promoting the principles of individual liberty in America.

Read Next