Support for charities is top of mind for many Canadians around the holidays. And this is important because charities provide valuable services such as counselling, crisis prevention, basic necessities and education to those in need. However, Canadians might be surprised to learn that, collectively, they are less generous than their American counterparts when it comes to private donations to registered charities claimed on income tax returns.

A recently released Fraser Institute report compares Canada and the United States on the extent and depth of charitable donations, using data on donations to registered charities from personal income tax returns. The report examines three different measures of charitable giving: the percentage of tax-filers donating to charity, the percentage of total income donated to charity, and the average dollar value charitable donation. On every measure, Canada lags behind the U.S.

In 2013 (latest year of available data), 21.8 per cent of Canadian tax-filers reported donations to registered charities. In the same year, 25.0 per cent of American tax-filers recorded donations. In terms of the extent of charitable giving, Americans were, on average, considerably more generous in 2013 and this difference is likely understated because of the way charitable donations are treated on U.S. tax returns.

The gap is even larger when we consider the percentage of total income donated to registered charities. Canadians collectively gave 0.56 per cent of total income to charity, while Americans gave at a rate nearly two-and-a-half times higher (1.39 per cent). In fact, if Canadians had given the same percentage of their total income to registered charities as Americans, there would have been $12.9 billion more money donated to Canadian charities (for a potential total of $21.7 billion).

The gap between Canada and the U.S. is largest when we consider the average amount donated to charities (see below table). The average U.S. donation in 2013 was US$5,342—almost three-and-a-half times the average Canadian donation of C$1,574. The disparity is more pronounced when currency differences are accounted for.

Moving away from the national figures, it’s also informative to examine data at the provincial and state level.

The report’s overall Generosity Index ranks the 64 jurisdictions in Canada and the U.S. (including the 10 provinces, three territories, 50 U.S. states and the District of Columbia). The index, which is based on the percentage of tax-filers donating to charity and the percentage of total income donated to charity, further highlights the gap between the two countries.

American states dominated the top of the rankings. Manitoba is the highest ranked Canadian jurisdiction but comes in 38th overall. The next highest Canadian province is Prince Edward Island (ranked 45th). Quebec is the lowest ranked province (ranked 59th). Only two American jurisdictions ranked below Quebec: North Dakota (ranked 60th) and West Virginia (ranked 62th). The Northwest Territories and Nunavut are at the bottom of the list, ranked 63th and 64th, respectively.

This result is not a single-year phenomenon. Canadian jurisdictions have consistently performed poorly compared to American jurisdictions over the years. While it’s not clear why Canadians are less generous than Americans, one thing is for sure: this generosity gap limits the ability of Canadian charities to improve the quality of life in their communities and beyond.