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21 July 2003

Release of Charities Definition Exposure Draft

I am today announcing the release of an exposure draft of legislation defining a charity for the purposes of all Commonwealth legislation.

The intention to legislate a definition was announced as part of the Government's response to the Report of the Inquiry into the Definition of Charities and Related Organisations, in my press release of 29 August 2002.

The legislative definition of a charity closely follows the definition that has been determined by over four centuries of common law, but will provide greater clarity and transparency for charities. It explicitly allows not-for-profit child care available to the public, self-help bodies that have open and non-discriminatory membership and closed or contemplative religious orders that offer prayerful intervention for the public, to be charities.

The legislation is expected to begin on 1 July 2004.

I have referred the draft legislation to the Board of Taxation for consultation with the charitable sector. I have asked the Board to report back to the Government by the beginning of December 2003. The terms of reference for the Board's consultations are attached. The Board will shortly make available the details of their consultation process.

I encourage interested parties in the charitable sector to provide submissions to the Board of Taxation.

Further details, and the exposure draft, will be available on the Board of Taxation website at

22 July 2003

Contact: David Alexander
02 6277 7340


Consultation by the Board of Taxation on the definition of a charity

  1. The Government has announced that it will codify the existing common law meaning of a charity and expand it to encompass certain child care organisations, self-help bodies and, closed or contemplative religious orders.

    Pursuant to this decision, the Board is to consult on the workability of the legislative definition of a charity proposed in the exposure draft Charities Bill 2003.

  2. In addition, the Board should specifically consult on whether the public benefit test in the Charities Bill 2003 should require the dominant purpose of a charitable entity to be altruistic, as recommended by the Report of the Inquiry into the Definition of Charities and Related Organisations.
  3. The Board should consult primarily with organisations intended to fall within the new definition of a charity.
  4. The Board should consider views put forward and provide its recommendations in a report to the Government by 1 December 2003.