Those that have been following the political activities saga will be happy to know that after years of promises, a court case, a blue ribbon Panel, and some annoying dithering the Federal Government has finally tabled legislation in Parliament to allow charities to engage more fully in ‘Political Activities’. In a previous article on this topic Political Activities…Revisited … Again we explored the history of the issue up to the release of proposed legislation in September 2018, since then there has been a consultation period and now the Government’s proposed legislation is being considered in Parliament.
The consultation period seems to have resulted in one substantive change from the Bill proposed in Notice of Ways and Means Motion which was substantially the same of the originally proposed Bill with one major exception. The new wording includes a specific provision that states that charities engaged in “public policy dialogue and development activities” would be considered to be acting in furtherance of their charitable purposes and not for any other purpose. The explanatory notes that came with this new proposal included some explanation of the intention behind this wording but did not specifically discuss the meaning of the word “dialogue”.
Typically, the Income Tax Act is interpreted with reference to the dictionary definition. Dialogue, of course, implies a conversation between two or more parties, and so one wonders whether a charity that is engaged in a monologue (i.e. nobody responding to the charity) may not be offside. It is hard to imagine that this was the intent of the law but perhaps the word ‘dialogue’ may yet be amended to more carefully describe the activity of charities.
The Motion was introduced as Bill-C86 and passed a second reading on November 6th of this year (you can follow its progress through Parliament here). Typically, the House of Commons will review the Bill and only after it has passed its third reading will the Senate then undertake its deliberations. As we wrote about previously, under normal circumstances, there should be some concern about the passage of this Bill prior to the summer recess. And, as we are expecting an election in the late summer or fall of 2019, a bill that does not receive Royal Assent will die on the Order Paper when Parliament is prorogued prior to the election.
In a bid to expedite the passage of the Bill the Senate has passed the appropriate rule to allow the relevant Senate sub-committees to explore the ramifications of the Bill simultaneously with the House of Commons. Then, once the Bill passes third reading in the House of Commons it should receive speedier passage through the Senate.
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By: Adam Aptowitzer