It’s not just me, right? Life feels really expensive these days. This summer, it seems to have really hit me. Now that an iced coffee costs me almost $7, it can no longer be an everyday treat. I went to the farmer’s market the other day, and a loaf of cinnamon bread cost me $11…which seemed just crazy.
Perhaps I shouldn’t have been surprised when a client recently asked if companies are increasing their gift thresholds. Given the current cost of living, they inquired whether a strict $50 threshold for business courtesies is still realistic. Until that conversation, I hadn't connected personal cost-of-living increases to corporate gift limits.
Having worked in compliance for over twenty years, I can tell you this: despite my iced coffee jumping from $2.75 to $6.50 over the years, I’ve seen very little movement in corporate gift thresholds. While exact numbers vary across organizations, a blanket $50 -$100 limit seems to have been in place for quite some time, across all sorts of companies and industries.
But given the current climate, it might be time for a change—or at least a thoughtful review. Although we have not seen a lot of movement (yet) on gift thresholds in the corporate compliance space, we do see regulatory frameworks recognizing that numbers might need to start accounting for inflation:
- FINRA: Earlier this year, FINRA raised its long-standing employee business gift limit from $100 to $300 per person per year.
- The Internal Revenue Service: For years, the annual limit for tax-free personal gifts sat at $15,000. Today, the IRS adjusts this figure for inflation, bringing it to $19,000 per recipient ($38,000 for married couples).
- Foreign Gift Reporting Rules: Under IRC Section 6039F, reporting thresholds for gifts from foreign entities periodically adjust upward (climbing past $20,000) so routine transfers don't create unnecessary administrative headaches.
- Federal Government Ethics Rules: Under the Foreign Gifts and Decorations Act (FGDA), the "minimal value" threshold for gifts accepted by federal employees is recalculated every three years based on the Consumer Price Index, rising to $525.
If federal agencies and tax authorities build inflation adjustments into their regulations, why shouldn't compliance policies do the same? (It’s also worth noting that global anti-corruption laws—like the US Foreign Corrupt Practices Act (FCPA) or the UK Bribery Act—do not generally set strict dollar limits. Instead, they focus on whether a gift was intended to improperly influence a business decision.) In other words, strict dollar caps are more often a self-imposed corporate restriction, not a strict legal mandate.
Outdated thresholds don't just frustrate employees—they can tax compliance resources on administering minor exception approvals rather than mitigating meaningful risk. A $50 gift cap set five years ago buys significantly less today.
Modernizing your policy does not require a total overhaul- whether that means bumping a $50 limit to $75, implementing a minor annual inflation buffer, or giving managers clear discretion for low-risk, everyday courtesies.
What next?
Adjusting a gift cap doesn't mean lowering your standards. You can update your threshold while still enforcing the core compliance principles that keep gifts and business courtesies reasonable, transparent, and conflict-free.
If you think you might be ready to update your policy, start with a two-fold approach: look within your organization and benchmark against your peers. Start by speaking with employees- are they feeling restricted by the current limits? Have they felt this restriction increase with the rising cost of living? Once you have a sense of whether this is something you need to take on, see what’s happening outside of your company walls. Speak to other compliance professionals, look at other policies online. Getting a sense of the benchmark is always helpful when planning to implement a policy change.
