The China Charity Federation says only 15 per cent of the donations it has received have come from mainland multimillionaires.

Lists of the richest people and the top philanthropists on the mainland, compiled earlier this year by Euromoney China and Forbes, may help to shed a bit more light on the situation.

And if true, the cold facts about the lack of benevolence would be enough to sadden our hearts -- unless you look at the local situation in a little more detail.

I think the present reality has been created by our unique past and a lack of government incentives.

Charity organizations re-emerged on the Chinese mainland in the 1990s and they have played an important role in helping the poor and people who have been decimated by natural disasters.

But that has not led to the creation of a social atmosphere for individual and company donations to charitable causes.

There are potentially many pitfalls for China's rich when it comes to being charitable.

For example, there is no specific law that protects what is considered an individual's private property -- although it is already a Constitutional pledge.

Other people may be concerned that showing off wealth could breed envy or hatred, or even endanger their safety.

Uppermost in the minds of Chinese entrepreneurs is to increase their wealth and further develop their enterprises, not charity organizations.

Giving to a charity is a personal decision, but more encouragement needs to be heaped upon our rich class to get them active.

During last year's SARS crisis, the State Taxation Administration said the value of all cash and material donated by companies for the fight against the disease could be deducted from their turnovers before paying tax.

Donations from enterprises soared soon after. Normally, the best a company can do is to have 3 per cent of its turnover deducted from its taxable revenue.

There is presently no law that allows a donation to be tax deductible, which is a huge incentive in other countries.

Also, because Chinese do not have to pay inheritance tax, most people prefer to leave their wealth to family members rather than giving it to a charity.

There is still a long way to go to promote such charitable acts in China. But it is something that requires effort from both the government and individuals.

(China Daily December 7, 2004)