China's charities receive little support from the business community with only one percent of domestic companies having ever made donations, according to a China Youth Development Foundation report released Monday.

The report cited by the Beijing News Monday said that only 100, 000 of China's 10 million registered companies have donated to charities.

The capital currently owned by Chinese charity organizations totals five billion yuan (US$605 million), accounting for 0.5 percent of the country's total gross national product, said president Fan Baojun of the China Charity Federation.

"Because of the capital shortfall, charity organizations can only assist a small number of the needy," he said.

The charity fund donated by companies of the United States averages 670 billion US dollars annually, about 9 percent of the country's gross national product.

Calling charities "a vital tool to redistribute social wealth and relieve poverty," Fan attributed the reluctance of the Chinese business community to donate to the lack of a charity culture.

After 11 years of development, there are only 100 charities in China, he said. Also, China's tax laws require donors to pay more personal income tax if their donations exceed three percent of the amount of tax to be paid.

Prof. Deng Guosheng with the Non-Governmental Organizations Research Institute of elite Tsinghua University proposed that the government follow the practices in Western nations to levy legacy duty and give more tax breaks for charitable giving.

He also hoped that the government would map out policies in support of the development of non-governmental charity organizations.

(Xinhua News Agency June 6, 2005)