Due to the huge presence of the international donors during the last decade, NGOs in Kosovo were exposed to enormous amounts of “easy to get” funds and didn’t feel the need for alternative sources of funding. During the last years, a number of donors have moved away from Kosovo, leaving the NGOs in a very competitive environment and not able to secure their sustainability. This has caused closing down of many NGOs due to lack of funds. Only a limited number of well-established NGOs have sufficient capacities and knowledge to provide services for third parties, including government and international institutions. The surveys show that only 0.53 % of the funds are raised from the services delivered by the NGOs. This percentage represents one of the biggest challenges of the sector in the years to come.
If the government funding for civil society is considered weak, the same situation appears also at the business side. Modern philanthropy concept is still on its very first steps, as it is the corporate social responsibility. Very few private donations and philanthropy activities are available for civil society in general, partly because of the recent introduction of a free market economy, and partly because of the strong traditional family support structures, which previously made formal philanthropy unnecessary. The surveys show that only 4 % of NGO funds come from the corporate, and the same percentage is at the private donations. In addition, these donations are mostly concentrated on humanitarian aid, health issues and social welfare, while other sectors of civil society remain mostly out of the scope of the businesses and individuals. The experience from other countries shows that most “socially responsible” are the foreign and international companies who invest in the region. In this regard, lack of foreign direct investments in Kosovo, namely lack of presence of serious international and foreign companies may be one of the reasons for this deficiency in cooperation between the private sector and civil society. In a situation of decreased international funds for civil society in Kosovo, strengthening this cooperation becomes very important for the future of civil society.
The legislation in force does not encourage private donations to civil society. The only provisions in the current legislation can be found in the Corporate Income Tax Law, where contributions made for humanitarian, health, education, religious, scientific, cultural, environmental protection and sports purposes are allowed as a deduction under the present Law up to a maximum of five percent (5%) of taxable income computed before the charitable contributions are deducted ( Article 10 Corporate Income Tax Law). The identical provisions are valid also for the Personal Income Taxes.
The Sponsorship Law, currently on its drafting process, appears as a good opportunity to initiate philanthropy. However, since it initially covers only culture, youth and sports activities, it still remains a challenge until becoming a real tool for contributing to domestic fundraising and civil society development in general.