“Definitely, I wouldn’t trust those who walk around with boxes at bazaars or on city streets.” Charitable foundations on the problems
September 5 marks the International Day of Charity. The Halyk Foundation organized a meeting with representatives of charitable organizations. Those gathered discussed the most pressing issues: why benefactors are not exempted from taxes, how to increase the trust of Kazakhstanis, and how to distinguish fraudsters from those who really need help.
Research: How many charitable organizations are there in Kazakhstan
Halyk Foundation specialists conducted a study and concluded that the data on charitable organizations in Kazakhstan are outdated. According to the Statistics Department, there are over 23,000 NGOs in the country, including public and charitable foundations and organizations. However, based on their 2023 reports, only about 5,000 organizations submitted documents, meaning that practically only 25% of NGOs can be considered active.
According to MIOR, there are currently more than 1,000 charitable organizations in Kazakhstan, while official eGov data says there are only 37.
Research: social survey
As part of the “Rukhani Zhangyru” program in 2021, a field study on charity was conducted in Kazakhstan. According to the research, most Kazakhs perceive charity primarily as financial assistance to those in need. 54% of respondents believe that charitable activities in Kazakhstan are insufficiently developed, though they do not explain why. Kazakhs are most willing to help in the following ways:
- orphans;
- people with disabilities;
- patients in difficult life situations;
- elderly people.
Migrants and repatriates were the least supported in society.
People prefer to transfer money through online payments. According to the survey, 83% of respondents took part in charitable activities, 81% made cash donations.
Kazakhstan in the world ranking
The Gallup Institute conducted a rating of countries in the field of charity. Kazakhstan ranks 93rd out of 114 countries in the list (as of the end of 2022).
“There are three indicators used in the ranking. The first is providing help to a stranger in need — here we rank 111th. The second is monetary donations for charitable purposes — we are 40th. And the third is the amount of time voluntarily spent helping others, which mostly reflects volunteer organization activity. Unfortunately, our country has been losing its position in recent years,” said Nariman Abilshaikov.
The Problem — Taxes
The Halyk Foundation analyzed the activities of foreign charitable foundations from the leading countries of Europe, the USA and Russia. In their opinion, we solve local and industry issues, while in the USA and Germany they provide assistance to third world countries.
So what makes developed countries look better than Kazakhstan in international experience?
“For companies engaged in philanthropy, there is a system of tax deductions. Let’s start with the U.S. Everyone has heard of the Bill & Melinda Gates Foundation. Their portfolio today exceeds $30 billion. In the U.S., tax deductions can reach up to 25%, which explains the large budgets currently distributed by foundations like Gates and Soros. In Germany, the deduction is 20%. In neighboring Russia, a large business engaged in charity can deduct up to 13% of its tax obligations. What about Kazakhstan? According to Article 288 of the Tax Code, large businesses here are eligible for only a 3% deduction, while medium-sized businesses get 4%,” — compared Nariman Abilshaikov.
The hands of charitable foundations are also tied in terms of the amount of assistance they can provide to those in need.
“When we talk about the law on philanthropy, we mean that assistance can be provided to individuals from socially vulnerable groups, where the threshold is set at 647 MCI (around 2.5 million tenge). If a family is not in the socially vulnerable category, but a child urgently needs surgery, charitable foundations are sometimes legally unable to provide help,” — cited Halyk Foundation director Sagynbek Shunkeev.
In addition, in addition to the material assistance itself, sponsors must pay a tax on the assistance provided in the amount of 10%.
True, the benefactors themselves understand that restrictions are needed to prevent charity from becoming a platform for tax evasion.
“I would even allow a 30% tax exemption, but only for honest, decent organizations—those who genuinely donate and direct funds to real needs. The problem is, I just don’t know how to monitor everyone to see where the money goes. A true charitable foundation has a website, publishes reports showing every tenge spent. But sometimes funds collect money on personal cards, like an official NGO collecting donations on its own or a spouse’s card. How is that possible? And people donate because each time there’s some trending story,” — expressed civil activist, founder and director of the NGO “Voluntary Society ‘Mercy’” and the educational project “Mektep Online,” Aruzhan Sain.
There is a problem of coordinating funds. For example, when there was a flood in Western Kazakhstan, it turned out that rubber boats, generators for pumping, shovels, bags were needed.
“When disaster struck, Kazakhstani people responded, and foundations provided funds. However, questions arose: where to go, what to buy, how to deliver, and to whom? Akimats collect up-to-date information and provide it to us, the foundations. That was the case during the floods and the quarantine. It’s convenient. But there were times during quarantine when we went to deliver food, thinking a needy family lived there, and it turned out to be a two-story mansion,” — said Sagynbek Shunkeev.
All the problems identified by the meeting participants were addressed to the relevant government agencies and will be discussed further.
Trust of Kazakhstanis in charitable foundations
In Kazakhstan, there is a low level of knowledge and trust in charity. Many perceive aid as “sadaqa”, that is, alms.
“I would definitely not trust those who walk around with boxes in bazaars and on city streets. Yes, that’s a thing of the past. But, unfortunately, scammers have already gone further and are using, so to speak, children from Yakutia who look like Kazakhs, they film them and write: I need help, here’s the bank account number, please help,” Sagynbek Shunkeyev gives an example.
Philanthropists believe that, overall, the situation with charity in Kazakhstan is fairly good. Just ten years ago, the number of foundations and the quality of assistance were not at the current level. Experts say the next step is the development of endowment funds. In such funds, capital is created through donations. The funds invest this capital, and the income generated is spent on social needs, while the original donations remain untouched and continue to grow.
Those gathered note how easily and quickly Kazakhstanis come together when help is needed. The latest example is the flood in the west of the country. Everyone was ready to help with clothing and food, diapers, and hygiene products. These are the top products that Kazakhstanis actively help with.
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