The Standing Senate Committee on Fisheries and Oceans in their final report calls for changes to the ITA to deal with revocation of registered charities that promote “misinformation and/or disinformation about the seal harvest or seal products industry “.
It also calls for greater disclosure of donors who give more than $5,000 to registered charities and non-profit organizations.
These are two very different proposals, which we will discuss below.
Here is the recommendation:
Recommendation 4 (Modifications to the Income Tax Act)
The committee recommends that the Government of Canada urgently review and amend the Income Tax Act and all other related acts, as needed, to ensure that registered Canadian charities and non-profit organizations that produce or promote misinformation and/or disinformation about the seal harvest or seal products industry have their tax-exempt status revoked.
In addition, the committee recommends that the Government of Canada amend the Income Tax Act to require registered Canadian charities and non-profit organizations to fill out information returns about donors, similar to those that are prescribed for registered journalism organizations in section 149.1(14.1) of the Act, which includes a public information return for the year in the prescribed form that lists each donor whose total gifts to the organization in the year exceed $5,000.
The first part deals with misinformation. Generally, I am not a fan of misinformation and/or disinformation! It appears to me that any registered charity (unlike a non-profit organization that is held to a much lower standard) that is involved with the dissemination of “misinformation and/or disinformation” should be able to be revoked by the Charities Directorate. Special legislation is not needed for dissemination of misinformation and/or disinformation specifically related to the seal hunt.
If I am wrong about that, then the ITA should be amended to make it clear that the dissemination of “misinformation and/or disinformation” should be grounds for revocation – but not specifically to any one area, such as seals or crisis pregnancy centres, etc. but for all information provided by registered charities. I hope that the ITA will not become some tool to oppress particular groups that another group does not like. Registered charities are not only supposed to carry out charitable activities but also to do so in a way that has a public benefit. I think it is an easy argument that “misinformation and/or disinformation” is not a public benefit but may also be illegal. Registered charities are not allowed to conduct illegal activities.
I often compare registered charities to people such as judges and preschool teachers. No one has absolute freedom of speech in Canada, but more importantly, registered charities, judges and preschool teachers have less freedom of speech than an average person on the street. If you want to be a registered charity, a judge, or a preschool teacher, you should accept and understand that. If you don’t accept that, you are probably working in the wrong job or at the wrong organization.
The second idea of having all donors who give over $5,000 be included in the T3010 is a complicated idea. First of all, considering this requirement for both non-profits and registered charities together is problematic. Many non-profits have no filing requirements at all. Only about a third have to file the T1044. Many who are incorporated would file the T1. Every registered charity needs to file a T3010 every year. So non-profits and charities are two very different situations. Here is my submission to the Finance Committee of the House of Commons on improving transparency in the non-profit and charitable sector: Blumbergs’ Pre-Budget Submission for the 2024 Canadian Federal Budget. We have been making similar submissions for about a decade with little effect.
I can think of many things I would want to know about non-profits before getting a list of their donors. With respect to charities in certain jurisdictions around the world, there is a disclosure requirement for major donors. These are often challenged as an invasion of privacy. I don’t have a problem with major donors being disclosed in the same way that when a foundation gives money to a charity, it is also disclosed. However, again, I can think of many other things that are more important than this. In most cases, by the way, major donors are not only disclosed but also recognized and celebrated. At the moment, Canadian registered charities have no obligation to disclose any of the political work they are doing on their T3010. When a $330 billion sector can get away with no disclosure of political activities, that is a recipe for distrust and people inappropriately using charities. So before worrying about major donors and their influence, perhaps we should have one or two questions on the political activities of charities.