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"If they take away our donations, or restrict them, we are doomed to extinction, and the most affected will be the most vulnerable."

Who bluntly assures it is Rocío Blancas, coordinator of the Guadalupe Musalem Fund, a non-profit organization that has been supporting women from rural, indigenous and Afro-Mexican communities in Oaxaca for more than 25 years so that they can study high school and access university.

Since its creation, the Guadalupe Fund has helped 173 young women with scholarships and with the possibility of moving them from the most remote communities of Oaxaca to a house that the Foundation has in the state capital, where they are offered free accommodation and medical care, as well as workshops on issues of equality, women's rights, ecology, and internet access to support them with their studies.

Read: ISR tax reform: Why does it put 5,000 organizations that serve vulnerable people at risk?

The objective is that, with access to education and participation in training and empowerment processes, scholarship women can return to their communities of origin and generate changes in their family environment and in the localities where they live.

All this, explains Rocío Blancas, is paid for thanks to the donations they receive each year from individuals and companies so that they can continue their altruistic work of supporting education for women in contexts of discrimination and poverty.

However, with the arrival of the pandemic and the economic crisis that it brought with it, getting donations has become an increasingly complicated task. For example, the activist raises, if before the health emergency they had 100 fixed donors, by 2021 the figure plummeted to 25.

"Many people stopped donating because they closed their businesses due to the pandemic, or because they got sick, or because they had to figure out how to survive themselves or their families," says the coordinator of the Guadalupe Musalem Fund, who, however, assures that "touching many doors” achieved sufficient resources to grant scholarships to fifteen young women who will study high school in the 2022 school year.

But, beyond the pandemic, the activist says that now they have a new great concern: the ISR tax reform proposed by the Federal Government. A reform that, although it does not prohibit donations, in real terms eliminates the tax incentive that benefits those who donate part of their income to civil society organizations.

Until now, individuals in Mexico can deduct expenses before the Treasury, such as medical, educational, funeral expenses, mortgage interest, school transportation, among others. And apart from those expenses, as a tax incentive, they can also deduct the donations they make to non-profit organizations up to 7% of their annual income, and 10% of the extraordinary contributions they make to the retirement savings fund.

With the reform, on the other hand, it is proposed that by 2022 the Tax Administration Service (SAT) reduce the size of that bag and that individuals can only deduct up to 15% of their total income, and that deductibles for donations are no longer in a separate bag, but inside this one bag.

In other words, individuals would have less margin to deduct taxes, and therefore, they must decide whether to deduct fixed expenses, such as doctors, insurance, etc., or deduct their donations to social works.

With this reform, the Mexican government argues that it seeks to expand tax collection and that it will invest the extra money it obtains in operating expenses and in strengthening its social programs to serve the most disadvantaged with scholarships.

However, organizations such as Alternatives and Capacities criticized that the proposal will discourage the donation that natural and legal persons make to civil society, affecting above all the 5,073 authorized donees who work with the most vulnerable sectors of the population, being able to stop Receive up to 8 billion pesos to carry out activities such as care for people with disabilities, low-income children with cancer, women who suffer violence, migrants fleeing violence, etc.

The activist Rocío Blancas puts it this way:

“If a person who has a median income level, is put in the situation of having to choose between deducting the children's tuition, or deducting medical expenses, or deducting a donation… What do you think they will choose? Well, obviously it will not be the donation.

For this reason, the activist foresees that, if the reform is approved in the Chamber of Deputies -it still needs to go to the Senate for discussion-, "a heavy blow" is coming for civil society organizations and their ability to operate, especially for smaller organizations working in the most remote and marginalized communities, where there is little or no state presence.

“Many people think that behind the donees there are huge corporations and stratospheric donations, and that is not true. There are many organizations that, if we do not receive donations, we cannot work. It's that simple: we can't exist," emphasizes Blancas, who also assures that another point that worries them a lot "is the tone, the environment, and what is being argued about the donees."

"Far from helping to build a strong and participatory citizenry, with this reform proposal they are generating distrust in people towards the work that civil society does," she concludes.

"The affected are the vulnerable"

Alejandro Barbosa is the director of Nariz Roja, a civil organization that provides care to children and adults with cancer. In the last two years, due to the shortage of medicines in much of the country, they have focused their efforts on providing cancer medicines to families and hospitals in states like Jalisco, where they currently serve 1,200 people. In addition, they have a shelter in Guadalajara that serves minors and women with cancer, who can stay there for free while they are treated at their respective medical centers.

All of this, from the most basic services of electricity, water, maintenance of the shelter, etc., to the heavy spillage for the purchase of oncology drugs, is paid for thanks to the donations they receive altruistically.

“We do not have a large company behind us that is sponsoring anything. Everything is donations from the people, and if we start to lack that, then we are going to find ourselves in the painful situation of having to deny the service to people who need it a lot”, explains Barbosa in an interview.

And that point, precisely, that of ceasing to care for hundreds of people with cancer, who come to them because the public health system does not care for them, is what the activist wants to highlight and put on the table: "On this issue of the fiscal reform, we, the civil organizations, are not what is important. That a civil association closes is not important. The problem is that help is being closed for many people.”

"Because if I close tomorrow, well, what's wrong," he adds. But tomorrow I'll start a business, or look for a job, and move on. What worries me a lot are all those people who received help, a service, care, and who, for example, are no longer going to have a shelter to stay in during their treatment, or are no longer going to find an oncology drug because there will be no one to help him.”

Yesterday morning, Tuesday, President López Obrador was asked in his usual morning conference what his opinion is on the fiscal miscellany, and he responded by defending this reform that contemplates the limitation of deductions for donations to civil society organizations.

In addition, he stressed that he does not agree with the return of taxes to large companies because their function is not philanthropy or donating to social causes.

He pointed out that their task is to invest, produce, create jobs and pay their contributions, while the role of the Government is to serve the population in need with these contributions.

“On the tax refund, we do not agree with that. How are taxes going to be returned to a large company under the assumption that they are going to invest for the benefit of the people, in social works, in philanthropy, in the promotion of culture? No, that is not the function of the company, the basic function of the company – and most of them do it very well – is to invest, produce, create jobs and pay their contributions”, he said.

López Obrador added that the tax deduction for companies so that they allocate it to social programs is an invention and that they should even contribute more.

“They invented that, and do you know why they invented it? To avoid paying taxes or to show off or greet someone else with a hat (...). Because of course philanthropy is important, but it is from the moment that I have my earnings and from my earnings I will contribute”, he pointed out.