Canadian Government Lifts Restrictions on Political Activities by Registered Charities

On October 31, 2018, the Government introduced proposed legislation as part of the Budget Implementation Act, 2018, No. 2 to change the rules for charities so that they have the full ability to pursue their charitable purposes by engaging in non-partisan political activities and the development of public policy. Specifically, the legislation proposes to:

  • Remove the Income Tax Act provisions relating to the non-partisan political activities of charities, including the provision that effectively limits charities to devote only 10 percent of their resources to non-partisan political activities;
  • Maintain the prohibition on charities providing direct or indirect support to, or opposition to, a political party or candidate for public office; and
  • Clarify that charitable organizations, like charitable foundations, must be constituted and operated for exclusively charitable purposes.
  • These changes are consistent with Recommendation no. 3 of the Report of the Consultation Panel on the Political Activities of Charities.

The above measures received royal assent on December 13, 2018. The proposed legislation will apply retroactively.

Click here to read the Notice of Ways and Means Motion and Explanatory Notes.

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