A federal advisory group has urged the Canada Revenue Agency to either close the loophole or accept that charities can now freely engage in partisan politics – such as campaigning to defeat sitting MPs who support same-sex marriage.
The current rules of permissive activity for charitable organizations wer an issue in the 2004 and 2006 elections. It’s come up in the public mind again as Conservatives hold nomination meetings under new dictates of the party national executive. Lois Hollstedt, chair of the charities advisory committee has advised the Canada Revenue Agency the loopholes need to be resolved.
“In recent months, we have seen an increasing amount of political-like activity by some charities,” Hollstedt said in a letter obtained by The Canadian Press under the Access to Information Act.
“In the committee’s view, much of this activity appears to cross the line from what is considered permissible political activity . . . to the type of activity the sector has always understood to be prohibited.”
The letter warns that some charities have defended their partisan campaigns against sitting MPs by arguing that the wording of the law prohibits such activity only during election campaigns, and not at other times.
“If the current prohibition on ‘partisan political activities’ does not apply to elected members, but only to candidates, the committee is of the view that amendments to the Income Tax Act be considered to rectify this anomaly.”
In a written response, the agency said it “recognizes this is an issue and that the current guidelines require more extensive revision.”
Charities that break the agency’s rules on partisan politicking can have their tax-exempt status revoked, though Ottawa has never done so.
Charity rules are outlined in Section 149.1 of the Income Tax Act.
The Evangelical Fellowship of Canada – Political Activity, Dos and Don’ts for Churches (.pdf)
Lloyd McKay (2003) – Canadian Protestant lobby groups (some of the people have moved on)
