Muslim charities in Canada are increasingly being targeted for audits and revocation of their status, according to a publication from the International Civil Liberties Monitoring Group (ICLMG), Ottawa, Toronto.
The challenges to charities are coming from a division within the Canada Revenue Agency (CRA), which coordinates tax policy and oversees benefit programs and tax credits, the ICLMG alleges in its report, The CRA’s Prejudiced Audits: Counter-Terrorism and the Targeting of Muslim Charities in Canada.
According to the report, the CRA’s Review and Analysis Division (RAD), which was established in 2003 to investigate terrorism financing within the charity sector allegedly:
- Uses anti-terrorism policies that allow it wide latitude in conducting surveillance, monitoring and auditing of Muslim charities;
- Disproportionately revokes Muslim charities, with 75% of charities revoked between 2008 and 2015 being Muslim-focused, despite these charities making up only 0.47% of all registered charities in 2015;
- Follows risk assessment for terrorism financing guidance issued by the Canadian government in 2015 which broadly concluded a significant portion of the risk stemmed from Muslim-linked entities;
- Has not provided public documentation of the number of audits or revocations it has performed since 2015; and,
- Does not always disclose the reasons that an audit was triggered.
The ICLMG requested that the RAD’s audit processes be reviewed by Canada’s National Security and Intelligence Review Agency, including an examination of previous and active audits of Muslim charities. It also requested an immediate suspension of audits of Muslim charities until the review is completed, that the anti-terrorism guidance of 2015 be revisited, that a complaint process be implemented and made transparent and that various governmental intelligence oversight entities review the CRA’s anti-terrorism activities.
In a statement to The NonProfit Times, Canada Revenue Agency Spokesperson Pamela Tourigny wrote: “The CRA does not select registered charities for audit based on any particular faith or denomination, nor does it maintain statistics tracking audits based on denominations. … A charity can be selected for audit for a variety of reasons including, but not limited to: a review of specific legal obligations under the Income Tax Act; a review of information from their T3010 annual information return; to follow-up on a previous compliance agreement; a referral from another area of the CRA; complaints from the public, articles in the media or other publicly available sources.”
Tourigny added that when audits find non-compliance, the charity is first given an opportunity to correct the non-compliance issues before sanctions or revocations are issued. Initial audit findings are shared with the organization, which is given an opportunity to clarify or add to information used in the initial audit.
Charities that disagree with decisions have the option of appealing to either the Federal Court of Appeal or the Tax Court of Canada, depending on the type of appeal, according to Tourigny.
As a general rule, CRA and RAD actions around audits are not transparent during the audit process or if there is no finding of transgression. “With respect to audits, the CRA’s actions can only be made public when they result in a charity being revoked, annulled, suspended, or penalized,” Tourigny wrote.
The ICLMG was formed in 2001 by a coalition of 45 Canadian non-government organizations, unions, professional associations, faith groups, environmental organizations and human and civil rights advocates. It was created in response to concerns about Canadian anti-terrorism legislation, privacy and government accountability concerns, and treatment of individuals in detention centers.