Regulation governing non-profit organisations in developing countries: A comparative analysis

Abstract

Purpose

The purpose of this paper is to provide a comparative analysis on the regulation, the applicable law and the tax treatment in the operations of NPOs in developing countries.

Design/methodology/approach

A comparative analysis in term of NPOs legal framework governing the formation, existence, restriction and fundraising of NPOs, as well as the tax treatment for the NPOs.

Findings

The findings suggest that regulations of NPOs in these countries exhibit a mixed picture with respect to the establishment, operation, affiliation and fundraising, as well as their tax incentives and preferences. In some countries, NPOs have fewer restrictions and are eligible for generous tax incentives, while for other countries, various restrictions and lack of incentives are the norms. The legal frameworks for NPOs are burdensome and, to some extent, do not reflect the importance of NPOs as partner for development of society. The findings also suggest that tax treatments in these countries vary from simple to complex coupled with obscure tax exemptions rules.

Originality/value

Around the globe, authorities and society are increasingly acknowledging the important role of NPOs in dealing with social needs from basic poverty, health and sustainable environments. This study’s focus on NPOs regulation will provide an understanding for authorities to design an appropriate framework for the growth and vibrancy of the NPOs.

Citation

Zulkhibri, M. (2014), "Regulation governing non-profit organisations in developing countries: A comparative analysis", International Journal of Law and Management, Vol. 56 No. 4, pp. 251-273. https://doi.org/10.1108/IJLMA-10-2012-0035