It's stupid in Canada and seemingly nothing to do with giving or encouraging it. If you're in the highest tax brackets, that last $1000 you earn as income nets you ~$550. If you donate that $550 to a charity, you only get a credit that works out to half your tax rate on $550.

It's less credit for the first $200 in donations, and more credit for amounts above that for unknown reasons. Because 2 people donating $200 shouldn't count as much as 1 person donating $400? Or $200 every year gets you less credit than $400 every other year. Shouldn't we encourage regular giving in small amounts?

Meanwhile, if you have a stock that goes from $100 to $1000 and donate it, not only do you get totally exempt from capital gain tax, you get ~30% back on that full $1000.

If your income is low enough to not pay income tax, you get nothing back on your donations until you do.

Why aren't income-earning people allowed to get a full deduction on the tax paid on their donations?