The Quebec government has introduced several new measures designed to increase private philanthropy in Quebec. These new measures were introduced in Information Bulletin 2013-6, released on July 3, 2013, and follow on the recommendations of the Task Force on Cultural Philanthropy, which was assigned in January 2013 to identify the causes of Quebec’s lag in the realm of cultural philanthropy and to propose possible solutions to promote private donations and other assistance to cultural organizations. The Bulletin indicates that amendments will be made in the tax legislation to implement these changes.
The Quebec legislation already provides a system of non-refundable tax credits and deductions for charitable donations. The donation credits are presently limited to 75% of net income, with a possible carry forward period of 5 years for individuals and 20 years for corporations. The new measures introduced on July 3, 2013 are in addition to the existing incentives.
The first measure is a credit for an initial large cultural donation. It is an additional credit of 25% of a donation of money made by an individual, if the donation is between $5,000 and $25,000 and made to a cultural organization. An individual may claim the benefit of the additional tax credit of 25% for an initial large cultural donation solely regarding a single large donation made after July 3, 2013 and before January 1, 2018. The donation may be paid in instalments as long as it is fully paid in one year. This credit also provides a carry forward period of 4 years.
The second measure is an additional credit for “cultural patronage”. An individual, other than a trust, may receive for a given taxation year, a non-refundable tax credit equal to 30% of the total of the patronage donations he made in the year or in one of the preceding five years, to a registered charity operating in Québec in the field of art or culture. This credit applies to an individual who wishes to give at least $250,000. This generous contribution could be made all at once or spread over 10 years, with a minimum of $25,000 per year. An individual may transfer any unused part of the tax credit for cultural patronage for a given taxation year to his spouse.
The third measure increases the eligible amount of a donation of a public art work. According to the information bulletin released by the Quebec government on July 3, 2013, public art is defined as art that encompasses works of art of a permanent nature, often of large size or of an environmental type, installed in a space accessible to the public for the purposes of commemoration, embellishment of a space or integration into the architecture or environment of public buildings and sites. To further encourage taxpayers to give that type of art work, the amount of donations of that kind to the state, to a municipality or to another public body is deemed increased by 25%. This amount can go up to 50% if the art work is acquired for installation in a place accessible to students. Those donations can be made after July 2013 and the fair market value of the donation must be certified by the Minister of Culture and Communications.
Finally, the government introduced a measure to increase donation amounts for a donation of an immovable for cultural purposes. This measure applies to an individual or corporation who gives an immovable capable of housing artists, students or cultural organizations. Therefore, the donee must be either a municipality, public body, or a registered charity operating in Quebec for the benefit of the community. If the donation is made after July 2013 and qualifies, the value of it is deemed increased by 25%.
With those measures, the Quebec government hopes to promote culture, in order to enhance Quebec’s profile and development while contributing to its growth and economy.