The federal government has tabled planned changes to the Income Tax Act, including amendments that will allow charities to engage in advocacy and programs to influence public policy without risking their charitable status.
The changes follow controversy about past Canada Revenue Agency audits that targeted charities engaged in advocacy and public awareness campaigns on issues like the environment or poverty.
The general rule up to now has been that charities could not put more than 10 per cent of their resources toward “political activities” without risking the loss of their charitable status. But what constituted political activity had not been clearly defined, leaving many organizations fearful that any advocacy could be construed as political.
The new rules – introduced after the Ontario Superior Court ruled against the CRA’s “10 per cent” policy – now allow charities to engage fully in “public policy dialogue and development activities generally involve seeking to influence the laws, policies or decisions of a government.” The activities do have to be consistent with an organization’s charitable purpose — for example, lobbying for measures to reduce poverty.
The amendments will still bar charities from “devoting resources to the direct or indirect support of, or opposition to, any political party or candidate for public office is maintained.”
Once passed, the changes will be retroactive in most cases to 2008, so charities that have engaged in advocacy will not face audits.
The changes, which follow consultations and a review of the current law, are being welcomed by the non-profit sector and offer members greater freedom in advocacy campaigns.