Mandatory CSR spends for companies are “like a tax” and Government needs to help identify beneficiaries, Tata Group Chairman Emeritus Ratan Tata said today, adding that philanthropy is an act which comes from within.

“Philanthropy or giving is something that comes within you and you obviously create another motivation when you mandate that you will give ‘x’ or ‘y’,” Tata said, in comments that come days after Facebook’s founder Mark Zuckerberg announced a plan to donate 99 per cent of his $45-billion fortune.

On Government making corporate social responsibility (CSR) spends mandatory for companies above a certain threshold at 2 per cent of profits, Tata said, “The mandated 2 per cent the Government has (enforced) becomes like a tax“.

He, however, stressed that a big amount of money gets generated through such contributions and it can be utilised better if the Government can clearly identify projects or sectors that are in need of funds.

Tata, who retired as the chairman on Tata Sons in 2012 after being at the helm for over three decades, said that Tata Group companies have been devoting up to five per cent of their profit for CSR for many years now.

Refusing to be drawn into a debate of ‘good philanthropy’ versus ‘bad philanthropy’ which has started following the announcements made by Zuckerberg and others, Tata said giving is a new phenomenon which needs to be given its time and space to grow and have course corrections.

He also termed philanthropy as an act of doing something good for society “without seeking to glorify yourself”.

Tata was speaking to reporters on the sidelines of an event to announce a tie-up with online education platform Khan Academy, under which the US-based non-profit specialising in online tutorials will create specialised content for India which can be accessed for free.