The Commissioner has in recent times been active in challenging the rights of certain taxpayer to charitable status. The Tax Acts provide for certain concessions in relation to certain charitable organisations or funds. Some are given deductible gift recipient status and others are given tax exempt status.

In a recent case, Bicycle Victoria Inc was found to be a charitable institution contrary to the decision of the Commissioner. The tribunal found that it was a charitable institution and therefore, subject to meeting the other requirements for endorsement as tax exempt, was entitled to that exemption. The tribunal followed the previous case law in determining whether or not Bicycle Victoria was a charitable institution. It found Bicycle Victoria was a charitable institution by reference to its constituent documents and its activities as revealed in its annual reports. The tribunal found that the dominant purpose of Bicycle Victoria was to promote the benefits of cycling to the community at large which was a purpose that promoted fitness in the community. The promotion of fitness in the community was a purpose which is a charitable purpose and was a purpose that is for the benefit of the community as a whole.  

However Bicycle Victoria did not satisfy the requirements for deductible gift recipient status because the prevention and control of disease in human beings was a consequence of Bicycle Victoria’s principal activity which was the promotion of cycling and of physical fitness and not its principal activity.