WHEN TAX-EXEMPT NONPROFITS DETRACT VALUE FROM SOCIETY



Gamble, Edward N and Munoz, Pablo
(2022) WHEN TAX-EXEMPT NONPROFITS DETRACT VALUE FROM SOCIETY. ACADEMY OF MANAGEMENT PERSPECTIVES, 36 (1). pp. 50-92.

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Abstract

Nonprofits receive tax exemptions in return for social value creation and delivery. While the outcomes of these tax exemptions are often positive, there are value-detracting situations in which the cost of granting the tax exemption is likely to exceed its benefits. To date, explanations for these value-detracting situations remain scattered and discipline-centric. Therefore, the purpose of this paper is to clarify the conditions under which tax-exempt nonprofits detract value from society. We survey 15 years of tax-exempt nonprofit scholarship, across nine disciplines, and identify three value-detracting conditions: policy-making and regulation intemperance, nonprofit management and governance distraction, and detection and prosecution inconsistencies. These three conditions interact and reinforce each other, compounding the value destruction to society. Overall, our findings offer important policy insights regarding the unintended consequences of tax exemptions, and our framework can be used to identify negative-return situations.

Item Type: Article
Uncontrolled Keywords: 44 Human Society, 4407 Policy and Administration, 35 Commerce, Management, Tourism and Services, 3507 Strategy, Management and Organisational Behaviour
Depositing User: Symplectic Admin
Date Deposited: 15 May 2020 10:37
Last Modified: 22 Jun 2024 12:29
DOI: 10.5465/amp.2018.0027
Related URLs:
URI: https://livrepository.liverpool.ac.uk/id/eprint/3087371