stuff
Quibbles: Revenue != profit. Cash flow != profit (possibly also != revenue, but I haven't studied accounting).
With no tax incentive, I would expect charitable donations to decrease. I'm not sure how you would replace that with a new incentive. I'm not sure how your subsidy idea would work. Would the government donate an additional X dollars for every Y donated? Instead of subsidies, should government programs make up for lost donations by performing the same functions as [insert charity here]?
As for the non-monetary assets bit, I can't remember what the hell I meant. I've slept since then. Something along the lines of capital gains maybe?
Key point: It's not necessarily clear what constitutes "making money". Should operating expenses be tax deductible i.e. should we tax revenue even if a business is breaking even, thus causing it to lose money -> shrink (lost jobs) -> potentially fail (more lost jobs)? And what about inflation? If a business runs at a nominal profit but breaks even or loses real value due to inflation, should we tax that "profit"?
Hmm. Do we need to define "charity" to distinguish it from the more general "nonprofit organization", or does it matter?