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(ECNS) - Alibaba founder Jack Ma has said the majority of donations made by him and co-founder Joseph Tsai will be used to finance initiatives in environment, education and medicine in China.
A report released by the Chinese Philanthropy Research Institute says that more than 24.2 billion yuan ($3.86 billion), or 80 percent of the total donations made by Chinese philanthropists in 2014, went to foreign charities.
A large part of the donations going overseas came from Alibaba's 16.9-billion-yuan share donations, it adds.
In response, Ma said that where a charitable trust is registered isn't equal to where the donations will be used.
"Before the donation, a consensus was reached by Joseph and me that the majority of our donations would be used for environmental protection, education and medical health in China," said Ma.
"Money is just one part of charity. The most important is our heart, action and conscience," he added.
A charitable fund system in China isn't well-established and what they donated is the equity of their overseas listed company, so they decided to register the fund overseas, he said.
According to Alibaba experts, donors and receivers have to pay taxes, because a share donation is regarded as sales in the Chinese mainland. However, donors don't need to pay income tax for an increased amount of equity donated overseas when charity institutes sell these equities.
Xu Yongguang, the vice-chairman of the China Charity Alliance, said that to promote further development of domestic charities, a charitable trust system should be set up as soon as possible in China.
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