Table of Contents
Last year, as many as 17.2 million taxpayers indicated the destination of the 5 per thousand to third sector bodies: approximately 730 thousand more signatures compared to 2022 (more than those collected by the 8 per thousand), for a total of approximately 552 million euros. Of these, however, almost 28 million euros were not distributed to non-profit organizations. The reason? The 5 per thousand provides for a maximum ceiling, which is currently set at 525 million euros. This is why, in the days of the discussion of the budget bill, ten large third sector associations asked for the elimination of the 5 per thousand ceiling. They are Aism/Fism, ActionAid, Airc Foundation, Emergency, Fai – Italian Environment Fund, Lega del Filo d’Oro, Doctors Without Borders, Save the Children, Telethon Foundation, Unicef: the funding that taxpayers have chosen to allocate to you and which were not assigned, in fact, could have made a difference in support activities for the vulnerable and in research promoted by non-profits. But where does the unpaid money go? And what are the concrete proposals for modifying the mechanism?
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How 5 per thousand works
Il 5 per thousand it is a fiscal subsidiarity instrument introduced in the budget for the first time in 2006 and made structural in 2015. Citizens, when filing their tax return, pay 0.5% of their Irpef to non-profit entities registered in the list of the beneficiaries held by the Revenue Agency and the social initiatives of the municipalities. “The 5 per thousand mechanism was conceived to allow citizens to allocate a part of their taxes to third sector bodies and social entities that engage in volunteering, social solidarity, scientific and health research and other activities of interest general your primary objective – confirm a Salute Paolo Bandieradirector of institutional relations of Aism (Italian Multiple Sclerosis Association) and its Fism foundation – This instrument is fundamental both to guarantee economic support to entities that directly pursue goals of general interest, and to promote among citizens the sense of civic participation and of social solidarity, allowing us to directly support non-profit organizations with socially useful purposes such as Fism”. Each citizen can therefore also choose the organization to which to allocate their share, indicating the relevant tax code. “The amount collected is divided among the non-profit organizations in proportion to the signatures collected – adds Bandiera – In the same way it works for the share not expressly associated with a specific tax code”.
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50 million less
“The taxpayers’ choices, however, are not fully respected – underlines Bandiera – The ‘extra’ (compared to the ceiling of 525 million euros, ed.) is included in the general taxation of the State, but, at least for us, it is not the destination is known and we do not know how they will be used.” What also makes the failure to respect the taxpayer’s choice even more evident is the recalculation mechanism due to the ceiling being exceeded, for which it is the bodies that have collected the most signatures that paradoxically suffer the greatest reduction: “The result is that even entities that received more signatures in 2023 than in 2022 have seen the resources assigned to them reduced this year.” In short – the associations denounce – this shortfall could have made a difference in the activities, for example allowing the financing of more assistance, research, environmental and cultural protection projects. Above all because the overrun has been occurring for several years now: from 2017 to 2022, more than 50 million euros did not reach the third sector. “This phenomenon occurs to the detriment of the will of taxpayers and of the organizations themselves – insists Bandiera – who are paid a lower amount than what they would actually be entitled to for the realization of social missions”. The Italian Multiple Sclerosis Association (Aism) and its Fism Foundation, for example, this year will lack over 350 thousand euros that could have been invested in a three-year research project.
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The proposals of non-profit organizations
This is why ten of the main associations are appealing to politicians to make the 5 per thousand equivalent to the 8 per thousand, for which there is no ceiling. “To overcome the problem, Fism and other large third sector entities have formulated proposals for the Budget Bill – explains Bandiera – In particular, there are two alternatives: eliminate the maximum spending authorization foreseen for the liquidation of the 5 per thousand or increase the maximum expenditure authorization foreseen for its liquidation”.
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Remove the roof…
As Bandiera reports, the first proposal is based on the fact that it is possible to guarantee non-profit organizations full financing of the 5 per thousand, respecting the will expressed by taxpayers. “This also responds to the need to enhance the model of stable economic development that these entities represent, and their fundamental contribution to the strengthening of a social fabric weakened by years of economic, health and social crises”.
…or increase it
The second alternative is, essentially, the progressive increase of the 5 per thousand ceiling, established on the basis of the impact of the failure to distribute the resources allocated from 2017 to today and the estimate of the ceiling being exceeded from 2017 to 2026. “The proposal which will be discussed provides for an increase of 45 million euros for the year 2025, 65 million euros for the year 2026 and 80 million euros for the year 2027 – Bandiera specifies – These data make it clear that failure to intervene to increase the ceiling in the next three years would subtract, in less than a decade, over 260 million euros from the third sector which would not be paid to the recipient bodies”. Finally, considering the growing use of 5 per thousand, chosen by 41% of taxpayers, we could evaluate the possibility of allowing recipient bodies to know the identity of donors, subject to consent, in order to improve information and direct transparency. on fund management. “Our proposals have attracted the attention of all the political forces in Parliament – concludes Paolo Bandiera – We are therefore confident that we will achieve our objective in the Budget Law”.
**How does the 5 per thousand mechanism balance the competing interests of taxpayer contributions and the funding needs of diverse non-profit organizations?**
## Open-Ended Questions for Discussion based on the Article:
**I. The 5 per Thousand Mechanism and its Impact:**
1. **Effectiveness:** How effective is the 5 per thousand mechanism in supporting non-profit organizations and promoting citizen engagement?
- Consider both the perspectives of beneficiaries (non-profits) and contributors (taxpayers).
2. **Transparency & Accountability:**
* To what extent does the lack of transparency regarding the “extra” funds collected beyond the ceiling undermine trust in the system?
* How can transparency and accountability be strengthened within the 5 per thousand mechanism?
3. **Alternatives:**
* Are the proposed solutions (eliminating the ceiling or increasing it) truly viable and sustainable long-term solutions? What are the potential drawbacks of each option?
**II. The Case of Aism and Fism:**
1. **Impact of Funding Shortfalls:** How has the funding shortfall specifically affected Aism and Fism’s ability to achieve its goals?
* What research projects or programs have been directly impacted by the reduced 5 per thousand allocation?
2. **Advocacy and Collaboration:** How successful has Aism been in raising awareness about the issue and advocating for change within the political sphere?
**III. Broader Implications and Future Directions:**
1. **Role of Non-Profits:** What is the broader significance of robustly supporting non-profit organizations through mechanisms like the 5 per thousand?
2. **Citizen Engagement:** How can the 5 per thousand mechanism be better utilized to foster active citizenship and social responsibility?
3. **Policy Recommendations:** What concrete policy recommendations can be made to ensure the 5 per thousand mechanism effectively serves its intended purpose and empowers both citizens and non-profits?
**IV. Ethical Considerations:**
1. **Donor Privacy vs. Transparency:**
* Does allowing non-profits to know the identity of donors (with consent) truly enhance transparency, or could it potentially compromise donor privacy?
2. **Fair Allocation of Resources:** How can a mechanism like the 5 per thousand ensure a fair and equitable distribution of resources among diverse non-profit organizations?
These open-ended questions aim to stimulate thoughtful discussion and diverse viewpoints on the 5 per thousand mechanism, its limitations, and potential improvements. They encourage participants to critically analyze the issue, consider various perspectives, and explore both the short-term and long-term implications for both non-profits and society as a whole.
