Abstract
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The aim of the paper is to present legislative changes for the NGO sector, which occurred due to the Covid-19 pandemic in the years 2020 and 2021, and its effects on the financing of NGOs in Slovenia. The work will consist of two parts, namely the theoretical and empirical part. In the theoretical part, I will use the descriptive method of writing, where I will present the existing legislation and different literature on the subject to describe and explain the concepts and already known facts related to the financing of NGOs, with emphasis on those NGOs working in the public interest. In the empirical part, I will analyze administrative, judicial, and parliamentary practices in this field.
I will then try to present arguments to confirm or reject the thesis that, although the existing NGOs Act from 2018 has many NGO funding benefits, the new NGO legislation – from 2021 - promoting an increase in permanent funding of the NGO sector, was actually a result of NGOs’ positive involvement in different activities during the epidemic.
Some initial research in the area shows that before 2018 there was little to no regulation on NGOs. The adoption of the 2018 NGO Act had an important and welcome effect since it defined (1) the conditions for being an NGO in Slovenia and at the same time defined (2) the needed conditions for granting the status of NGO in the public interest. One of the important novelties was that the NGO Act established a special budget fund for the (general) development of NGOs. The source of financing was the undistributed 0,5 percent of persons personal income tax, which taxpayers did not choose, but could have in accordance with the Personal Income Tax Act, to finance activities of general public interest, finance political parties, or representative (labor) unions. The recipients of the “leftover” funds are selected on a yearly basis through a public tender procedure. In December 2020, the Act Determining Intervention Measures to Assist in Mitigating the Consequences of the Second Wave of COVID-19 Epidemic was adopted. In it, the Government first proposed raising the percentage from 0.5 to 1 percent, but at the same time abolishing the fund. In practice, this meant that the undistributed “leftovers” of 1 percent of a person’s income tax would become a part of the state budget instead of a special NGO development fund. This proposal was met with widespread opposition raging from NGOs to the media, political parties etc. The arguments used in the debate mostly promoted the positive contribution to society of different projects and programs, the funds are being used to support, such as employment growth, welfare issues, sports.
The end result was a legislative change that now enables a taxpayer to donate up to 1 percent of personal income tax to grant beneficiaries such as NGOs, political parties, representative trade unions, registered churches, and other religious communities. Although, the NGO Act from 2018 seems to have led the acting Government to try to abolish the “0.5 fund”, what it did, in the end, was – with the parliaments’ intervention - lead to an improvement in the NGO financing system, by providing an even higher stable source of NGO financing.
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