The Consultation Panel on the political activities of charities that was appointed by the Minister of National Revenue in 2016, recently submitted their report.[1] While the main recommendations of the Panel, were to “make changes to enable charities to fully participate in public policy dialogue and development”[2] , and to change how the Canada Revenue Agency (“CRA”) administers certain provisions of the Income Tax Act (Canada) that affect charities, the Panel went even to further recommended as follows: “Modernize the legislative framework governing the charitable sector.”[3] The Panel, using common sense after reviewing thousands of submissions received, recommended that the new legislative framework include things such as:
- a focus on charities’ purposes, rather than activities;
- an inclusive list of charitable purposes reflecting contemporary social and environmental issues and values; and
- the ability to appeal a refusal to register and revocation decisions to the Tax Court of Canada.[4]
With a nudge to the Government the Panel further directed that this process should start as soon as possible. The appendix to the report includes a very easy to understand chart summarizing the consultation recommendations which leads to the ultimate desired outcome of having new legislation and public policy that gives relief to charities and provides clear, consistent and enforceable standards for the future regulation of charities in Canada. This is a strong message.
Coincidentally, this is exactly what Prime Minister Justin Trudeau said to the Minister of National Revenue in his mandate letter (http://pm.gc.ca/eng/minister-national-revenue-mandate-letter) in 2015 shortly after the Liberal Government was elected in Canada. Very succinctly, the Mandate letter to the Minister of National Revenue directed that the Canada Revenue Agency to:
“Allow charities to do their work on behalf of Canadians free from political harassment, and modernize the rules governing the charitable and not-for-profit sectors, working with the Minister of Finance. This will include clarifying the rules governing “political activity,” with an understanding that charities make an important contribution to public debate and public policy. A new legislative framework to strengthen the sector will emerge from this process.”[5]
So the message gets louder and the circle is complete. The Prime Minister and the Panel that the Minister herself appointed have directed that those who have the job description for legislative reform in this area get busy on this new legislative framework to strengthen the sector. It is hoped that this will soon emerge now that the process to spark change has been completed. The next step, therefore, is to for the legislative framework to be presented.
It behooves the Canadian public and the charitable sector to keep up the pressure on the Government to move this process along. Over the summer and indeed until the legislation is presented, we should all keep up the pressure on the CRA to deal with this process and get the Department of Finance drafting the legislation. In the normal spirit of all things government, we could expect this on the late hours of a Friday before a long weekend. So stay tuned as there are two long weekends coming up fast in the summer across Canada. Standby for further developments.
[1] Report of the Consultation Panel on the Political Activities of Charities, http://www.cra-arc.gc.ca/chrts-gvng/chrts/cmmnctn/pltcl-ctvts/pnlrprt-eng.html
[2] ibid
[3] ibid
[4] Ibid
[5] Minister of National Revenue Mandate Letter, http://pm.gc.ca/eng/minister-national-revenue-mandate-letter