PEST Analysis: Niagara Furniture Bank

PEST analysis is a useful business tool to analyze the external factors that may affect an organization’s operation. PEST analysis includes four factors. The four factors are political, economic, social, and technological.
The political factors concentrate on the role of governments in shaping business such as labor law, tax, and financial policies. These government policies will significantly influence the way companies operate. More business-friendly policies can lead to a better business environment that fosters business growth and success. Niagara Furniture Bank is a registered charitable organization. One important political factor for the registered charity industry is perhaps the minimum wage. The Ontario government introduced Bill 148,

However, registered charities in Canada receive preferential tax treatment from the CRA. For instance, registered charities can issue donation receipts to donors. Under section 118.1 of the Income Tax Act, a taxpayer can claim a charitable donation credit for amounts donated to registered charities (Branch, 2017). This tax benefit helps taxpayers to reduce their tax bills to the CRA. The value of the federal donation tax credit is equal to 15% of eligible amount up to $200 and 29% of the eligible amount that is over $200 (Agency, 2017). The government uses this tax policy to help registered charities to grow by incentivizing taxpayers to donate. Registered charities are also exempt from paying income tax under paragraph 149(1)(f) of the Income Tax Act (Branch, 2017). This is another tax benefit that registered charities in Canada receive from the government. However, the government highly regulates Canada’s charitable sector. There are obligations that a registered charity must meet to keep its registered charity status. These obligations include: 1) devoting its resources (funds, personnel, and property) to its charitable purposes and activities, 2) filing its annual Form T3010, Registered Charity Information Return, within six months of its fiscal period-end, 3) meeting its annual spending requirement, 4) keeping adequate books and records in Canada, and make them available for review by the Canada Revenue Agency on request, 5) making sure