The UK, Italy, the Netherlands, and Ireland give away the largest portion of their gross domestic product (GDP) to charity amongst European countries, according to figures from the Charities Aid Foundation (CAF).
CAF’s ‘Gross Domestic Philanthropy: An international analysis of GDP, tax and giving’ looked at data from 24 countries worldwide to examine factors affecting the link between GDP and charitable giving.
While the report acknowledges the challenges in making cross-border comparisons due to differences in the way that data is recorded nationally, results indicate that European giving falls far behind the US, which tops the league table with 1.44 per cent of GDP donated to charity. UK donors give 0.54 per cent of GDP, followed by 0.30 per cent in Italy and the Netherlands, and 0.22 per cent in Ireland.
The report looks at measures including overall tax burden, top tax rate, average income tax, corporation tax, government expenditure as a percentage of GDP, and employer social security charges. The analysis shows no significant link between government spending, income or corporation tax and the proportion of GDP donated by individuals, with the exception of employer social security charges.
In this case, there is a negative correlation between the rate of social security contributions paid by employers across all countries covered and the percentage given by individuals to charity.
However, the data also shows that there is a positive correlation between charitable giving and other aspects of giving such as volunteering time and helping a stranger.
Adam Pickering, international policy manager at CAF, said: “This suggests the relationship between the amount of taxes people pay and the amount they give to charity is not as clear-cut as some may have thought. The factors which motivate people to give, and influence how much they give, are incredibly complex.”