The Legal Protection Of Equity Charitable Donation

The development of philanthropy innovates the forms of donation,and non-monetary assets donation appears,among which equity charitable donation is the most common one.With the deepening of our understanding of equity,more and more entrepreneurs devote themselves to charity by donating equity.Different from the equity donation in the sense of civil donation,equity charitable donation has its legal particularity and plays a variety of values:first,it is beneficial to the donor to maintain the stability of the financial market and obtain tax incentives for the donor;Second,it helps public welfare and charity organizations to obtain stable sources of funds,develop continuously and achieve precise assistance;Third,we can promote the improvement of the relevant legal system in the charity field,so as to promote the progress of charity.However,the legislation on philanthropy started late and the legal guarantee on equity charitable donation was insufficient,which resulted in the blocked channels of equity charitable donation.For example,Niu Gensheng Overseas trust donated shares,Cao Dewang was forced to change his idea of donating shares,and Chen Shufa gave up equity donation.This is not conducive to the flow of more wealth into the charity sector and the role of charity in helping the needy and poor.This paper analyzes the cases of Niu Gensheng and Cao Dewang through the research methods of case analysis and comparative analysis,and draws lessons from the implementation experience of foreign equity charitable donation tax preferential policies,dual share structure and voting right trust system.It finds that there are three problems in the equity charitable donation of Chinese donors:first,the dilemma of shareholders’ exercise of shared interest right after the donation.The donee is not suitable to exercise the shareholder’s right,and the donator’s exercise of the right is not protected by law;Second,tax incentives are insufficient.Preferential tax policies need to be refined.The qualification of pre-tax deduction is strictly recognized in China.Most charitable organizations cannot receive preferential tax treatment.Third,the compulsory offer system restricts the donation of shares.The mandatory offer system limits donations to 30%of the trigger points.To this end,the following suggestions are put forward:first,optimize the exercise of shareholders’ beneficial rights,and apply the voting trust and dual share structure to equity charitable donations;Second,improve the tax incentive system,refine tax preferential policies,lower the threshold of pre-tax deduction eligibility,and improve tax preferential policies for public trusts;Third,improve the compulsory tender offer system and add exemption from special compulsory offer.Only by constantly improving the legislation,can we gradually clear the obstacles of equity donation in the charity field,further encourage enterprises to donate equity,and promote the sustainable development of our charity.