TUSEV convened NGO and state officials to discuss improving the regulatory
treatment of public benefit organizations in Turkey
On July 14 2005 TUSEV convened NGO and state officials to discuss improving the
regulatory treatment of public benefit organizations in Turkey. This was the first time
such a meeting was convened on this topic, with participation from both government and
civil society. 25 participants included NGO leaders from umbrella organizations, human
rights associations, and NGOs focusing on micro-credit, education, women’s issues and
poverty eradication, and key state officials from the Ministry of Interior, Ministry of
Finance and Foundations Directorate.
The interactive roundtable workshop was led by David Moore from the International
Center for Not for Profit Law (ICNL), and facilitated by the team at TUSEV. Throughout
the day participants reviewed existing legislation and procedures and discussed the core
principles and best practices regarding public benefit and taxation. In conclusion all
participants agreed on the following outcomes:
The qualifying criteria for what organizations are considered “public benefit” should be
clear, objective and defined similarly for associations and foundations. The current
practice dictates significant differences between the 2 types of organizations- for
foundations, the concept is too limiting, and for associations it is too broad and therefore
allows for too much discretion by decision makers. It was agreed that the qualifying
activities should be defined clearly enough so that discretion by decision makers is
limited, but flexibly enough to allow room for interpretation and change over time,
depending on the needs of society.
The designated governmental decision-making body should be objective,
independent from political influence, and sufficiently expert in public benefit decisionmaking. In addition, NGO-applicants should benefit from procedural safeguards during
the application process. Although the Council of Ministers is the final decision making
authority in Turkey, it obtains recommendations from the Ministry of Finance as well as
either the Department of Associations or the Foundations Directorate, depending on the
applicant organization. It should be noted that the main complaint in this area was the
length of time it takes to reach a decision, and the lack of transparency due to the
number of agencies involved in the process.
Procedure and conditions under which public benefit status can be obtained were
discussed in great detail. The three main issues regarding this topic were government
review (ensuring a certain time limit for responses to applications- which is currently not
the case in Turkey), required documentation (ensuring that documentation is not
cumbersome), and timing (discussing when an NGO should be eligible to apply). In
addition, participants discussed what conditions and restrictions apply – or should apply - to public benefit organizations. Current procedures and conditions are inconsistent, not
clearly defined by law or regulation, and sometimes susceptible to discretionary powers
of authorities- which makes the application process more difficult and subjective.
Tax benefits to NGOs and their donors were discussed at length. Although tax
benefits are generally enabling, income from economic activity is always subject to full
taxation. It was agreed that more enabling conditions for donations from individuals and
companies (e.g. removing obstacles to payroll giving, increasing deductions for
donations, etc.) were also necessary.
In summary, the day-long discussions provided for a meaningful and substantive
exchange on this important issue. This promising first step (which was a follow up to
several studies and reports on this issue in previous years) holds much potential in
moving forward with reforms that will encourage more viable conditions for NGOs
engaging in public benefit activity, as well as promote and increased flow of donations to
the sector from individuals and corporates. The detailed proceedings from this workshop
will be available on www.tusev.org.tr and shared with all respective stakeholders as
inputs for the policy process. For more information on this and similar initiatives please
contact [email protected] or [email protected] .
This event was made possible with the generous support of:
United States Consulate
Istanbul, Turkey
charities aid foundation