Up to 10 percent of the resources—money, people, time—of a Canadian charitable organization can be devoted to what regulations call “political activities.”
Repeated studies show that the average is far below this, and that many charities do not participate in political activities. But a 2010 survey by Imagine Canada, the umbrella organization of charities, found that 37 percent of charities actually participated in some form of “political activity,” compared to the one percent of organizations that actually declared in their tax returns that they had done so, as found in a 2012 study by Canadian Press.
The Imagine Canada study has credibility because it asked charities to report their various kinds of communications, and then the researcher sorted through them to discover which met the government’s definition of “political activities.”
That’s a massive discrepancy. And probably the result of confusion in the charity sector about what kinds of communications are considered acceptable. That confusion may be exacerbated, at least in the public mind, by federal cabinet ministers as far back as 2012 framing political activities as something undesirable, and inappropriate for organizations that can offer donors a receipt allowing a tax deduction. The rhetoric ramping up to the audits of “political activity” spoke of criminal organizations, terrorist organizations, money laundering, and radical ideological agendas.
The public, and by extension charity leaders, can be excused for thinking that “political activities” occur when you recommend that citizens vote for a specific party or candidate in an election, or inappropriately participate in a political party’s event, or get really personal in criticizing a governing party or opposition politician. If that’s what was going on, who wouldn’t want charities audited, caught, and spanked?
But that’s not Canada Revenue Agency’s definition of “political activities.” Under the regulations, an organization can seek to pressure the government about an issue central to the charity’s official purpose (Canada’s four allowable charitable purposes are alleviating poverty, advancing education or religion, or other purposed beneficial to the community). Pressuring government is fine so long as the charities do not get partisan or exceed 10 percent of their resources. So, yeah, they can advocate for their point of view as experts in an area, and should presumably be able to do so without harassment. And if the charity conducts a study, and then speaks of the recommendations of the study, that’s not even considered political activity under the regulations, but rather “charitable activity” and so they can do it without limit. Or at least these are what the charity “experts” I spoke to see as the difference between charitable, political, and partisan activities.
Clear? Well, there are indeed grey areas and one of my research findings is that, despite making some progress on this front, CRA needs to further clarify these. Instead, some leaders say the CRA is interpreting more strictly. Whether the interpretations are in flux will become clear as the audits now underway come to fruition.
In any case, as a researcher the questions that I find most interesting include why the government rhetoric seemed calibrated to cause confusion, to frame as criminal or un-Canadian some organizations that were working within the rules as they know them. Why were millions of dollars suddenly needed for auditing charities? What charities are being audited? What’s the affect on charities that advocate on public policy issues? Most importantly: what’s in it for the government, why this, why now, and what does it tell us about the vitality of our democracy?
But more on that next posting.
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I am a former journalist and media manager who recently completed my Master’s thesis for Royal Roads University and now works as a communications professional. I have been awarded a Webster Award of Distinction, among other awards, for my reporting.