Tuesday, April 24, 2012

Re-Thinking Charitable Status in Canada

I heard an interesting interview with Greg Oliver, President of the Canadian Secular Alliance, on the radio yesterday about the charitable status of religious organizations in Canada, and the effect of that status on tax revenues. Given the most recent federal budget in Canada, with a whopping budget deficit not expected to be in the black for another 3 - 4 years (no one can really accurately predict these things given the wide swings in global economic activity), every billion dollars of federal revenue and expenditure seems fairly relevant.

In Canada, to qualify as a charitable, an organization must fall within one of four categories of work: 1) the relief of poverty, 2) the advancement of education, 3) the advancement of religion, or 4) other purposes that benefit the community in a way the courts have said are charitable, according to an 1891 ruling in the United Kingdom (Commissioners for Special Purposes of Income Tax v. Pemsel). Number three certainly seems to stand apart from the others, and given that this definition is based on a British court ruling from over 120 years ago, perhaps it is time to revisit this definition. The other three categories seem fair enough. When asked to define charity, most people would probably say something about giving to the poor. The advancement of education is one very specific and effective way of reducing poverty and advancing society and so logically belongs in the definition of charity. In a country such as Canada with a Common Law system, the rulings of the courts are what ultimately determine much of the law. Therefore the fourth definition of charitable status (as defined by the courts) is inescapable. But the advancement of religion? Should we use tax revenue to support that cause? Surely not. 

As pointed out by the host of the interview I was listening to, religious organizations do much poverty relief work and as such should qualify for charitable status. Certainly so. Any organization, religious or secular, which performs work aimed at reducing poverty should retain its status as charitable. There are many organizations which straddle more than one of the four definitions above, and their status as charitable should remain based on whichever of the other three apply. But what about organizations that have the sole purpose of promoting religion? We do realize what this means? An organization that supports young indoctrinated men and women coming to your door to disturb you at dinner time while they launch into their sales pitch for Mormonism is supported by your tax dollars. Does that seem right? 


The financial side of things is perhaps as important as the rationale. The total tax revenue lost to Canada as a result of organizations that are defined as charitable based solely on definition three above is about $1.8 billion per annum. So, any religious organization that mixes their proselytizing with some poverty relief or education is not included in that figure. In other words, if the federal government would recognize that the advancement of religion, alone and not in conjunction with any other benefit, is not an activity it wants to support financially, Canadians would now be $1.8 billion closer to eliminating the deficit. 


The current conservative government in Canada sold Canadians on its abilities to balance the budget and eliminate the deficit (which they created while a minority government one should point out) during their five years in office. Canadians bought what they were selling. Canadians bought into the fear that said that we needed a strong hand on the tiller in this global economic storm. Yet, the government won't shore up an easy $1.8 billion along the way because they believe that the advancement of religion is an activity that is worthy of financial support by every tax payer in Canada. Just so we're clear on the dollar amount here, every single Canadian citizen pays over $50 per year specifically to promote religion. Not to help religious organizations alleviate poverty or educate children, but solely to promote religion in society.


Shame.

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