A new study suggests that the British rich are becoming less charitable.
According to the British private banking firm Coutts, the total value of charitable donations worth 1 million or more has fallen to its lowest level since 2007. The total value of all the million-plus gifts fell to 1.2 billion last year from 1.6 billion in 2006-2007.
The numbers prompted the usual hand-wringing in Britain about why the wealthy aren’t more charitable. In speeches and comments for the past few years, politicians and many of the rich themselves say the U.K.’s rich should be more like Americans. Much of that discussion focuses on the more generous tax deductions given for charity in the United States. An article in the Daily Mail said that Americans who earn more than 150,000 a year “give a staggering eight times as much to charity as do their British counterparts.”
But a closer analysis of the numbers suggests that, when it comes to millionaires, the U.K. may be just as generous as the United States – and maybe even more generous. (Read more: Super-Rich: Tax Us When We’re Dead)
Last year, there were 232 donations in the U.K. of 1 million or more. According to the Center on Philanthropy at Indiana University, the United States had around 811 donations of $ 1 million or more – about 3.5 times the U.K. But the United States has about seven times as many millionaires as the U.K. So on a per-millionaire basis, the U.K. millionaires made twice as many million-plus donations as the United States.
On a total wealth basis, the U.K. also looks generous. The value of million-plus gifts was 1.2 billion in the U.K., and $ 9 billion in the U.S. Given that some studies show the total value of millionaire wealth in the United States is more than ten times that of the U.K., the total gifts by the British wealthy also surpass the United States. (Read more: BRICs Outpace US for Millionaires)
This is not to say that either side gives enough – that’s entirely subjective. But it does suggest that the story of the U.K. lagging behind the Americans in giving may be overstated. And it suggests that tax deductions may not be the all-important factor when it comes to why the rich around the world give to others.