German charitable foundations and philanthropists enjoy a variety of tax advantages. This paper transfers the US debate about the legitimacy and power of charitable institutions driven by authors like Giridharadas, Williamson, Callahan and Reich to the German context. After an exploration of the scope of tax advantages to charity at the status quo, different roles that corroborate or put into question philanthropy’s special tax status are outlined. The advantages and disadvantages of corporate philanthropy for civil society are examined, as are those of private foundations in the specific German context. Due to the lack of a clear legitimacy framework at the status quo, the reassessment of the status of charitable institutions by civil society is recommended. Depending on the basis of argumentation, different conclusions arise regarding future legislation.