CRA Rules governing charities’ political activities
April 19th, 2012 | By: Ethical Oil
Following Ethical Oil’s Our Decision.ca campaign to expose the radical foreign funded environmental groups activities attacking Canada’s ethical oil and industry, the Federal Government has responded. In Budget 2012 the Feds announced they will be devoting $8 million to the enforce existing charities law and clamp down on charities engaged in partisan and excessive political activity.
To help you get past the fear mongering and rhetoric, we thought we would show you the law that we cited in our letter to the CRA.
To read more about our efforts and take action, CLICK HERE.
CRA RULES REGARDING CHARITIES AND POLITICAL ACTIVITY
Section 149.1(1) of the Income Tax Act, RSC, 1985, c. 1 (5th Supp.) provides that a charitable organization is required to devote all of its resources to charitable activities. Section 149.1(6.2) provides that a charitable organization may donate part of its resources to political activities, provided that the activities are ancillary and incidental to its charitable activities and do not include the support of, or opposition to, any political party or candidate. The application of the Income Tax Act is described in CRA Policy Statements, as set out below.
An organization with political purposes does not qualify for registration as a charity. Political purposes are those that seek to:
- further the interests of a particular political party; or support a political party or candidate for public office; or
- retain, oppose, or change the law, policy, or decision of any level of government in Canada or a foreign country.
Partisan political activity involves direct or indirect support of, or opposition to, any political party or candidate for public office. A charity may make the public aware of its position on an issue, even if that position is supported by a candidate or political party, provided:
- it does not explicitly connect its views to any political party or candidate for public office;
- the issue is connected to its charitable purposes;
- its views are based on a well-reasoned position; and
- public awareness campaigns do not become the charity’s primary activity.
A charity may provide information to the public on how all Members of Parliament or legislative body voted on an issue connected with the charity’s purpose. However, a charity must not single out the voting pattern of any one elected representative or political party.
A registered charity may take part in limited political activities provided the activities are non-partisan and connected and subordinate to the charity’s purposes. A charity engages in political activity if it:
- explicitly communicates a call to political action (i.e., encourages the public to contact an elected representative or public official and urges them to retain, oppose, or change the law, policy, or decision of any level of government);
- explicitly communicates to the public that the law, policy, or decision of any level of government in Canada or a foreign country should be retained (if retention is being reconsidered by a government), opposed, or changed;
- explicitly indicates in its materials (whether internal or external) that the intention of the activity is to incite, or organize to put pressure on, an elected representative or public official to retain, oppose, or change the law, policy, or decision of any level of government in Canada or a foreign country; or
- attempts to sway public opinion on social issues.
While not all attempts to inform public opinion on an issue are political activity, any purpose that suggests convincing or needing people to act in a certain way and which is contingent upon a change to law or government policy is a political purpose.
To read the full policy statement, click here.