Imagine Canada, the national umbrella for Canada’s charitable and nonprofit sector, has reacted to yesterday’s Ontario Superior Court of Justice ruling in the case Canada Without Poverty v. AG Canada.
In his ruling, Justice Morgan declared the sections of the Income Tax Act that restrict registered charities’ political activities to be unconstitutional. The ruling also expands the Income Tax Act’s definition of charitable activities to include political activities. The prohibition on charities engaging in partisan activity was not in question, and remains in place.
“We are very pleased by this ruling,” said Bruce MacDonald, Imagine Canada’s President and CEO. “It is in line with recommendations made by charities from across Canada and by the advisory panel on political activities that the Minister of National Revenue appointed in 2016. It also reflects commitments made by the federal government in its 2015 election platform, and in the Prime Minister’s mandate letters to several cabinet members, including the Ministers of Finance and National Revenue.”
Political activities are defined by the Canada Revenue Agency as public expressions by a registered charity that any government (domestic or overseas) should adopt, amend, or maintain particular laws, regulations, or policies. Political activities also include efforts by registered charities to engage the public by, for example, organizing petitions or letter-writing campaigns urging governments to take particular policy positions.
“The Income Tax Act provisions in question, and the way in which they have been administered by the CRA, have been very unclear and have created great uncertainty for charities,” added MacDonald. “The definition of what constitutes a charity has not changed, but the ruling recognizes that charities should be free to engage in whatever activities their volunteer-led boards deem most effective in order to achieve their charitable purpose as accepted and enforced by the CRA.”
“This ruling demonstrates the need for us to modernize charity law in Canada,” concluded MacDonald. “We’re operating under a hodge-podge of rules dating back to Queen Elizabeth I. In its platform and in the Prime Minister’s mandate letters to cabinet, the government committed itself to work towards a new legal and regulatory framework. We see this as a golden opportunity to work with the government towards that end.”
Imagine Canada is a national charitable organization whose cause is Canada’s charities and nonprofits. Our three broad goals are to strengthen the sector’s collective voice, create opportunities to connect and learn from each other and build the sector’s capacity to?succeed.
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