Novartis Foundation announces revamp of grantmaking strategy

• DOI: http://doi.org/10.1002/nba.30647
• Date: 01 September 2019
• Published date: 01 September 2019

SEPTEMBER 2019 NONPROFIT BUSINESS ADVISOR

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© 2019 Wiley Periodicals, Inc., A Wiley Company • All rights reserved

DOI: 10.1002/nba

a 50% deduction and gifts over 1% of adjusted gross

income would receive a 100% deduction. Itemizers

would still receive the current charitable deduction.

Overall, the policy is estimated to increase chari-

table giving by up to $24.9 billion, a 7.3% increase over

current law, and to increase the number of households

that donate by up to 4.6 million, a 5.2% increase over

current law. The policy would reduce Treasury revenue

by up to $17.9 billion, the IS said. Therefore, the

policy would bring in up to $7 billion more in chari-

table dollars than is lost in Treasury revenue—more

than any other option studied in the report.

• A nonrefundable 25% charitable giving tax credit.

Under this option, nonitemizers would get a 25%

nonrefundable tax credit, which would be a boon to

charitable giving. According to the IS, this option is

estimated to increase charitable giving dollars by up

to $36.9 billion—an increase of 10.8% over current

law—and to increase the number of households that

donate by up to 10.6 million, a 12% rise. However,

the policy would reduce Treasury revenue by up to

$33 billion, so in aggregate, it would bring in around

$3.9 billion more in charitable dollars than is lost in

Treasury revenue.

• An enhanced nonitemizer charitable deduction ,

which provides a higher value deduction for low-

and middle-income households. Under this option,

single lers earning under $20,000 can deduct 200%

of the value of their charitable donations, single

lers earning between $20,000 and $40,000 can de-

duct 150% of their charitable donations, and single

lers earning over $40,000 can deduct 10% of their

charitable donations. Married couples ling jointly

earning below $40,000 can deduct 200% of the value

of their charitable donations, married couples ling

jointly earning between $40,000 and $80,000 can de-

duct 150% of their charitable donations, and married

couples ling jointly earning over $80,000 can deduct

100% of their charitable donations.

This option is estimated to increase charitable

giving dollars by up to $29.2 billion, an increase of

8.5% over current law, and to increase the number

of households that donate by up to 8.4 million, an

increase of 9.5%, the IS said. The policy would reduce

Treasury revenue by up to $24.3 billion, netting an

overall increase of $4.9 billion more in charitable

dollars than is lost in Treasury revenue.

Looking just at increases in charitable giving, the

fourth option—a non-refundable tax credit—is the

most attractive, the IS said. But it also noted a couple

of concerns. First, it has the biggest impact on Trea-

sury revenue, and so does not have the best net return.

Also, policymakers may be able to lower the percent

value of the credit over time without taxpayers notic-

ing, the IS said. When the tax credit percentage dips

below a certain level, it no longer incentivizes giving

as well as other policies.

But, the organization argued, the nonrefundable

tax credit is also the fairest of the bunch, having the

largest positive impact on the number of households

that donate to nonprots overall, and at every income

level except the top 1%. Considering current trends in

giving—that middle- and lower-income households

are increasingly opting out, and more and more of

the nation’s charitable dollars are coming from the

wealthy—this option shows the most promise for

increasing equity in the philanthropic sector, the

report said.

For more information, visit https://independentsector.

org. ■

For more information

Soraya Alexander is senior vice president of marketing

at Classy, a San Diego–based provider of online fundrais-

ing software for nonprots that helps to modernize the giv-

ing experience to accelerate social impact around the

world. For more information, visit https://www.classy.org.

Novartis Foundation announces revamp of grantmaking strategy

The Novartis Foundation is refocusing its

grantmaking to concentrate fully on how to leverage

data, digital and AI to transform global health.

This new mandate builds on 40 years of striving

for sustainable impact on health in low-income

populations, most recently by focusing on leprosy

elimination and cardiovascular health, in addition

to digital health.

More specifically, the foundation will focus

on how digital technology can reengineer health

systems from being reactive to becoming proactive

and even predictive. To that end, the foundation

will work with partner governments to co-dene

national health priorities that data, digital and AI

can address, and jointly build roadmaps for digital

transformation of health systems.

For more information, visit https://www.

novartisfoundation.org. ■