Charities will be required to keep records to show whether donations of more than $250 were from what the Bill calls “allowable donors’ or from “non-allowable donors”. This will add significantly to the administrative costs (needless red tape) of charities.

The definition of “allowable” is quite complex. Generally, for an individual this means that they are either an elector, an Australian citizen, or an Australian permanent resident (unless the Minister decides that the resident is not an allowable donor). (287 AA)

For most charities the vast majority of donations come from what would be deemed allowable donors. However, a very small number of donations are likely to come from non-citizens or residents of other countries who are appreciative of the work done for them or their families. Specific accounts would need to be set up for this small number of donors and kept separate from other general revenue accounts. No funds from these separate accounts could be used for the broadly defined political expenditure. Even if no such donations are received, charities who are registered as political campaigners will still need to show that all donations of $250 or more were from allowable donors. There is also the possibility of fines of over $50,000 for charities who breach the legislation.

Thus, the ultimate effect for charities will be a set of complex, cumbersome and costly administrative requirements. This will force many charities to divert resources away from frontline services and advocacy. For some charities, it may also have a “chilling” effect, deterring them from speaking out about injustices in order to avoid the onerous administrative costs that such advocacy would incur.