Companies sometimes match donations to charity. What if the government did too?

Imagine a charity comes to you with an offer. If you give them a donation now, they’ll get it at least partially matched — so for every dollar you give, a wealthy benefactor will add 25 cents. Your giving has a higher bang for the buck than normal.

Now imagine the charity instead tells you that your gift might help your taxes ... but it probably won’t. In fact, there’s a 90 percent chance it will do nothing to reduce your tax burden. But there’s a small chance it will help. How much will it help? Hard to say; you might get anywhere from 10 to 37 percent of the donation back on your taxes next year, depending on a ton of other factors that have nothing to do with charity.

Which of these options sounds better to you? And more importantly: Which of them is more likely to spur you to donate?

The second option is how the United States charitable deduction currently works. It’s only available to people who “itemize” their deductions, meaning they eschew the standard deduction for specialized benefits based on mortgage payments, state taxes, and other factors. But barely 9 percent of filers even did that in 2021, and they are disproportionately wealthy ones.

How much the charitable deduction reduces your taxes, and thus benefits you, depends on your tax bracket, which means it could be worth as little as 10 percent of your gift or as much as 37 percent. It’s a complex, difficult-to-understand program, which surely limits how effective it can be at its main goal: encouraging Americans to give to charity.

The first option, the 25 cents on the dollar match? That’s what the United Kingdom does. When you donate to a charity there, you can check a box confirming you’re a UK taxpayer. The charity then gets a 25 percent match from the government on all donations from taxpayers.

The program is called Gift Aid, and it has helped the UK preserve its system of pay-as-you-earn income taxes, in which about two-thirds of Britons don’t have to file tax returns at all. Most things that would be deductions in the US instead exist outside the tax system in the UK, in programs like Gift Aid. It seems to work at making giving more popular: A recent global survey found that 71 percent of Britons donated to charity, compared to 61 percent of Americans, and a sharp contrast from the very low rates of giving in much of mainland Europe (37 percent in France, 42 percent in Italy).

It’s a simpler way to incentivize charity, and as Tax Policy Center economist Robert McClelland explains in a new report, it’s a more effective way too.

Many studies suggest matches are more effective than deductions

In recent decades, economists and psychologists have taken to conducting studies trying to uncover biases in the way people respond to economic situations, a research program known as “behavioral economics.” For instance, people tend to be more sad about losing something they have than happy when gaining something of equivalent value (“loss aversion”); they tend to put undue weight on the first thing they hear about a certain subject (“anchoring bias”).

Partly due to this research program, a number of economists have conducted experiments to see whether matching grants or a “rebate” like the charitable deduction work better. McClelland reviews many of these experiments and finds that they overwhelmingly show matches are more effective.

The team of Catherine Eckel and Philip Grossman conducted many of these trials. A paper of theirs in 2003 found that a match was about three times as effective as a rebate; a 2017 paper includes three experiments, all of which find matches are more effective if your goal is maximizing the ultimate resources of the charity.

Gift Aid means a simpler, fairer tax system

The UK model has other advantages too. Gift Aid functions as a universal, refundable charitable credit of 20 percent, available to all of its residents regardless of their tax bracket or situation. It is not solely available to a minority of taxpayers who claim a special set of itemized deductions. It is available to all Britons regardless of income. That means a wider share of donors get their philanthropic preferences reflected.

The administration is also simpler than a credit because donors need not remember their donations when filing taxes. Administration for charities is also relatively simple, requiring only a report of eligible donations to His Majesty’s Revenue & Customs. This is equivalent to the Form 990 reports already required of large charitable institutions in the United States. The additional reporting burden would be fairly minimal.

What’s more, this kind of approach would make it easier for the US to eliminate its itemized deductions, a long-held goal of tax reformers. Economists generally believe the home interest deduction is a disaster that makes homes more expensive and encourages excessive debt; the state and local tax deduction is mostly a regressive transfer to wealthy people in high-tax states. Eliminating the charitable deduction in favor of a Gift Aid program would reduce the number of people using these deductions too, by making itemizing less attractive overall.

If, as expected, Congress votes to continue the larger standard deduction passed as part of the Trump tax cuts in 2017 (and which is currently set to expire in 2025), these deductions will continue to be claimed by only a small share of taxpayers. Getting rid of the charitable deduction would make that share smaller still, and help shrink itemized deductions to a size where they might be junked entirely.

A Gift Aid program would also eliminate certain key abuses of the charitable deduction. In recent years, wealthy donors have flocked to “donor-advised funds,” investment vehicles at financial institutions like Fidelity or Charles Schwab that promise their proceeds will eventually be dispersed to charitable institutions. Donors receive immediate charitable deductions for their contributions to these funds, irrespective of when or even if their donations are actually dispersed (there is no time limit within which they have to spend the money). This has provoked attempts at reform meant to speed disbursement, but as of this writing, no reform has passed Congress.

More daringly, some taxpayers have used the charitable deduction to subsidize what amounts to personal consumption. A number of wealthy art collectors have in recent decades claimed large deductions for donations to museums they themselves have created — and which are rarely, if ever, open to the public. The Brant Foundation Art Study Center, located close to the home of its benefactor Peter Brant in Greenwich, Connecticut, provided Brant with tax breaks for all the art he endowed it with, despite only being open to the public by appointment.

Without a charitable deduction, these kinds of abuses would not be possible, and they would not be possible under a Gift Aid regime either. While a billionaire-controlled nonprofit art museum would be eligible for Gift Aid reimbursement, it would be legally required to use that money to further its philanthropic mission. By contrast, money a taxpayer saves due to the charitable deduction could be legally used for any purpose. Donor-advised funds could give to charities that then in turn receive Gift Aid subsidy, but the subsidy would only come when the funds were actually dispersed.

2025 is a time to get creative about taxes

While much of the focus today is on this year’s taxes — get them in by the end of the day — next year is set to be one of the most consequential years in a long while for the federal tax code.

Most of the individual provisions of the 2017 Trump tax cuts — the rate cuts, the larger standard deduction and child credit, limits on the state and local and mortgage interest deductions — are expiring. With Trump wanting to defend his legacy and Biden refusing to raise taxes on people earning under $400,000 a year, both parties desperately want to preserve the bulk of these cuts.

One of my biggest hopes is that they do this in a way that makes the code overall less, not more, complicated and reduces taxpayers’ burden in time and energy. Replacing the charitable deduction with a Gift Aid program would go a long way toward that, pushing the US further away from specialized deductions for this and that and toward a simpler system where everyone at a given income pays the same amount.

Taking the Teenage Mutant Ninja Turtles in a bold new visual direction has worked out phenomenally for Paramount in the past, but the studio’s next experiment with the characters feels like something that’s going to be tricky as hell to pull off well.

According to The Hollywood Reporter — Paramount is in the early stages of developing a live-action, R-rated film based on The Last Ronin, IDW’s 2020 comic that tells the story of how one of the Teenage Mutant Ninja Turtles grows up to become an even deadlier warrior following the death of his three siblings. The movie is set to be produced by former head of DC films Walter Hamada, and Boy Kills World co-writer Tyler Burton Smith is attached to write the script.

The comic series — written by Kevin Eastman, Peter Laird, and Tom Waltz and illustrated by Esau Escorza, Isaac Escorza, and Luis Antonio Delgado — was far darker than most classic Teenage Mutant Ninja Turtles stories and left readers guessing as to which member of the original quartet they were seeing eviscerate scores of people on the page. Coming after Teenage Mutant Ninja Turtles: Mutant Mayhem, pivoting the Turtles IP back to live-action feels like a risky bet on Paramount’s part that’s going to remind everyone how nightmarish the 1990 adaptation was.

But as solid as the comics are, Paramount could be onto something with this new project, especially if it can find a creative team that has the right vision.

Rachel Treisman reports via NPR: Authorities in the Russian republic of Chechnya are banning music they consider either too fast or too slow, effectively criminalizing many genres. The Chechen Ministry of Culture announced the ban on its website last week, by the order of Culture Minister Musa Dadayev and with the agreement of Chechen leader Ramzan Kadyrov. "Musical, vocal and choreographic" works will be limited to a tempo of 80 to 116 beats per minute (BPM) to "conform to the Chechen mentality and sense of rhythm," said Dadayev, according to the Russian state-run news agency TASS. "Borrowing musical culture from other peoples is inadmissible," Dadayev said, per a translation by The Guardian. "We must bring to the people and to the future of our children the cultural heritage of the Chechen people. This includes the entire spectrum of moral and ethical standards of life for Chechens." Russian media report that artists have until June 1 to rewrite any music that doesn't conform to the new rule, though it's not clear how it will be enforced. [...] The government's crackdown on certain musical tempos would silence most modern music genres. Electronic styles of music like house, techno and dubstep all tend to have BPMs of over 116, says the audio tech company Izotope, while the average tempo of 2020's best-selling pop songs was 122 BPM, according to the BBC. The independent Russian news outlet Meduza said the tempo of the Russian national anthem would be considered too slow under the new limit, reports RadioFreeEurope/RadioLiberty. But it would seem to permit hip-hop music, which generally has a BPM of 85 to 95. "Chechnya is a roughly 6,700-square-mile autonomous republic situated in the North Caucasus of southern Russia and home to some 1.5 million people, the vast majority of whom are Muslim," notes NPR. "The U.S. Commission on International Religious Freedom has said Kadyrov's regime 'maintains hegemony through the imposition of a purported 'traditional' version of Islam, which falsely claims to defend local belief and culture, and combat violent extremism.'" "'In reality, Kadyrov has [co-opted] Chechen religion and culture to support his brutal regime, which violates the secular constitution of the Russian Federation and international standards of freedom of religion or belief,' it added."

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A bill introduced in the US Congress on Tuesday intends to force AI companies to reveal the copyrighted material they use to make their generative AI models. From a report: The legislation adds to a growing number of attempts from lawmakers, news outlets and artists to establish how AI firms use creative works like songs, visual art, books and movies to train their software-and whether those companies are illegally building their tools off copyrighted content. The California Democratic congressman Adam Schiff introduced the bill, the Generative AI Copyright Disclosure Act, which would require that AI companies submit any copyrighted works in their training datasets to the Register of Copyrights before releasing new generative AI systems, which create text, images, music or video in response to users' prompts. The bill would need companies to file such documents at least 30 days before publicly debuting their AI tools, or face a financial penalty. Such datasets encompass billions of lines of text and images or millions of hours of music and movies. "AI has the disruptive potential of changing our economy, our political system, and our day-to-day lives. We must balance the immense potential of AI with the crucial need for ethical guidelines and protections," Schiff said in a statement. Whether major AI companies worth billions have made illegal use of copyrighted works is increasingly the source of litigation and government investigation. Schiff's bill would not ban AI from training on copyrighted material, but would put a sizable onus on companies to list the massive swath of works that they use to build tools like ChatGPT -- data that is usually kept private.

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Privacy startup Proton already offers an email app, a VPN tool, cloud storage, a password manager, and a calendar app. In April 2022, Proton acquired SimpleLogin, an open-source product that generates email aliases to protect inboxes from spam and phishing. Today, Proton acquired Standard Notes, advancing its already strong commitment to the open-source community. From a report: Standard Notes is an open-source note-taking app, available on both mobile and desktop platforms, with a user base of over 300,000. [...] Proton founder and CEO Andy Yen makes a point of stating that Standard Notes will remain open-source, will continue to undergo independent audits, will continue to develop new features and updates, and that prices for the app/service will not change. Standard Notes has three tiers: Free, which includes 100MB of storage, offline access, and unlimited device sync; Productivity for $90 per year, which includes features like markdown, spreadsheets with advanced formulas, Daily Notebooks, and two-factor authentication; and Professional for $120 per year, which includes 100GB of cloud storage, sharing for up to five accounts, no file limit size, and more.

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Fairphone, the Dutch smartphone maker known for its user-repairable smartphones, is bringing its ultra-repairable design philosophy to their "Fairbuds" wireless earbuds. Liliputing reports: The Fairbuds have the sort of features we've come to expect from premium earbuds. They're noise-cancelling Bluetooth 5.3 earbuds with support for wind noise reduction and an environmental noise-cancelling feature that sets noise reduction depending on your environment. Fairphone's earbuds have six microphones, 11mm drivers, and an IP54 rating for water (and sweat) resistance. They also support multipoint connectivity, which means you can connect the earbuds to two different devices at the same time (like your phone and your laptop). The earbuds offer up to 6 hours of battery life and they come with a charging case that gives you another 20 hours of use between charges. And Fairphone offers iOS and Android apps that let you adjust EQ, install firmware updates, and make other changes. Other features include automatic play and pause when the Fairbuds are removed from your ears, capacitive touch controls, and three different ear tips sizes included in the box. But the key thing that makes these earbuds different from the competition is that they're designed to be repairable rather than replaceable. Lose just one earbud? Fairphone will let you buy a single earbud without paying again for a full set with a case. Is your battery life degrading a few years after purchase? Fairphone will sell battery replacements and let you swap out the batteries in your earbuds or charging case. All told, the company offers seven repairable/replaceable components for the Fairbuds. The company also offers a 3-year warranty for its new Fairbuds and notes that they're manufactured using: - 70% of all materials used in production are fair and recycled (fair = ethically sourced). - 100% of rare earth elements used are recycled. - Plastics used in the Fairbuds and their charging case are recycled. The Fairbuds are currently only available in Europe for 149 euros.

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