Politics and Advocacy by Robert B. Hayhoe, Miller Thomson LLP Canadian Council for International Co-operation AGM Ottawa, May 26, 2005

Common Law Definition of Charity “Heads” 1.Advancement of Religion 2.Relief of Poverty 3.Advancement of Education 4.Other Purposes Beneficial to the Community  All heads must be carried out for public benefit

Income Tax Registered Charity must have “exclusively charitable purposes”

Political Purposes By definition, cannot be charitable

Definition of “Political” Purpose that: supports or opposes a particular political party or candidate seeks to retain, oppose or change the law, policy or a decision of any level of government in Canada or elsewhere

Theory of Political Activity Prohibition Charity must be for public benefit political purposes requires debate about desirability of the purposes (questions public benefit)

Stated v. Unstated Purposes CRA looks behind stated purposes (in corporate objects) at activities and purposes

Incidental Political Activities Common law and ITA permit incidental political activities if carried out for a charitable purpose

Political Continuum 1.Prohibited Political Activities 2.Permitted Political Activities (limited) 3.Permitted Charitable Advocacy Activities (unlimited)

Prohibited Activity Illegal Activity illegal defined by Canadian law Partisan Political Activity direct or indirect support of a party, officeholder or candidate

Coincidental Policy Position Support or opposition to a policy that is supported by a particular party Permitted, provided: –charity does not explicitly connect views to any party –issue connected to purpose of the charity –well-reasoned position –campaigns are not charity’s primary activity

Limited Political Activities Permitted if non-partisan, and connected and subordinate to charity’s purposes “Substantially all” resources must be donated to charitable purposes other than politics –traditionally 90%

“Substantially All” Revisited Annual income of up to $50,000 – up to 20% political Annual income of $50, ,000 – up to 15% political Annual income of $100, ,000 – up to 12% political Two year carry-forward of substantially all percentage –based on T3010A data

Permitted Advocacy Activities Communication with public issue related to charity’s programming subordinate –promoting point of view is not charitable by itself well-reasoned and accurate position –limited emotion

Permitted Charitable Activity Distribution of research –to public –to politicians –to press Policy Development –even with government

Politics and Advocacy by Robert B. Hayhoe, Miller Thomson LLP Canadian Council for International Co-operation AGM Ottawa, May 26, 2005