Problems of Taxation of Nonprofit Organizations in Russia [Part 3]

摘要

sector enterprises, as well as for-profit firms operating as government contractors or providing fee-based services to consumers, cannot function efficiently enough in providing certain public and so-called merit goods. Among the reasons for this are the following. First, all else being equal, the government in power reflects the interests of only the part of the electorate that voted. Taking this into account, nonprofits do not replace public-sector organizations but supplement government activity to provide certain goods. Second, as follows from some studies, government contracts cannot ensure socially optimal provision of goods in all cases. Third, for-profit firms operating in the interests of their owner may find it unprofitable to provide some services, even for a fee, in the amount that society needs. Fourth, in many cases the organizational and legal form of a nonprofit organization is preferable for donors, philanthropists, and consumers of the services. In this case, donors may not completely trust for-profit firms or government agencies, and for the same reasons consumers are usually more inclined to select a nonprofit as their service provider. Fifth, nonprofits can ensure greater diversification of the services provided than is possible in the public sector.