Readout: Advisory Committee on the Charitable Sector – March 30 & 31, 2023

The Advisory Committee on the Charitable Sector (ACCS) met in person for a two day meeting in Toronto on March 30 and 31, 2023.

March 30, 2023

Sharmila Khare, Director General, Charities Directorate, Legislative Policy and Regulatory Affairs Branch of the Canada Revenue Agency (CRA), opened the meeting by taking a moment to acknowledge that the meeting was taking place on the traditional territory of many nations including the Mississaugas of the Credit, the Anishinaabeg, the Chippewa, the Haudenosaunee and the Wendat peoples and is now home to many diverse First Nations, Inuit and Métis peoples. The three sector co-chairs, Sheherazade Hirji, Bruce MacDonald, and Hilary Pearson, provided brief opening remarks that welcomed the members and thanked them for attending despite their busy schedules.

Sharmila acknowledged that the Office of the Taxpayers’ Ombudsperson (OTO) had published its report and indicated that time had been added to the agenda for a summary and discussion; she then invited Robert Delaney to provide an update on the CRA’s draft Guidance CG-032, Registered charities making grants to non-qualified donees. Robert noted that the CRA grouped the submissions into those that were in support of the guidance and those that were not; approximately 20% were in full support, around 60% in partial support, and the remaining 20% not in support or provided some other comment. It was noted that CRA would be moving away from a “risk-focused” guidance and would instead be encouraging charities to practice due diligence. The CRA is targeting to publish the updated guidance document in June 2023.

Following this, there was a lengthy discussion on whether or not to publish the ACCS’ submission on the CRA’s request for feedback on the granting guidance.

Office of the Taxpayers’ Ombudsperson Report Update

The Secretariat provided an update on the Office of the Taxpayers’ Ombudsperson report, Charity Begins with Fairness: More to Explore, on the fairness of the Canada Revenue Agency’s audit process for charities.

Sharmila noted that both the Minister and the CRA responded to the OTO’s report. The Committee was advised that effective immediately, every permanent employee at the CRA will be required to participate in mandatory unconscious bias training; and that Charities Directorate employees will be required to participate in mandatory training on cultural competency and religious literacy.

Mid-point check-in

Sharmila led a discussion on the mid-point check-in of the ACCS given that about 50% of the members are nearing the halfway point of their terms. The purpose of the discussion was to determine what the Committee would like to accomplish before the membership renewed. Sharmila noted that feedback from the ACCS on the following issues would be helpful to the Directorate:

1. Client services (call centre, website, written enquiries)
2. Registration process
3. Outreach – expanding our sector outreach
4. Enhanced transparency
5. Clarity of correspondence

GBA Plus Presentation

A presentation was given by the CRA’s Gender Based Analysis Plus Centre of Expertise.

The purpose of the presentation was to provide ACCS members with an overview of Gender-based Analysis Plus (GBA Plus) at the CRA.

During this presentation, the Committee was provided with the Government of Canada’s definition of GBA Plus and its importance, its history in the Government of Canada, information on how it is applied to work at the CRA, and the GBA Plus supports and tools available to employees.

Following this presentation, members had an opportunity to ask the GBA Plus specialist questions.

ACCS Governance

The co-chairs presented a draft question and answer document related to ACCS governance, which led to a lengthy discussion on the transparency of the committee. Many members noted that they felt the 24-month term length was not long enough and suggested that a recommendation be made to the Minister to lengthen membership terms to 36 months. It was agreed that more clarity is required around the principles and governance of the committee.

There was a discussion regarding the submission the ACCS prepared to address the CRA’s request for feedback on the draft CG-032 and whether the range of perspectives from the ACCS should be published. Although members shared various opinions, there was general consensus that a collection of ACCS perspectives should be published on a case by case basis. The ACCS plans to develop a framework for this prior to implementation.

During this discussion, the ACCS members observed that conversations could become challenging, given the passion and multiple perspectives that members bring to the table. The Co-chairs acknowledge that all members need to work on this aspect of the meetings to strengthen a culture of mutual inclusiveness in a supportive environment.

Definition of charity and charitable purposes working group (DCCPWG) Exercise

Bob Wyatt led an exercise on behalf of the Definition of charity and charitable purposes working group. He asked the committee “To what problem is a statutory definition of charity the best or only solution?” It was noted that the definition of what qualifies as a charity has long been a subject of debate, whereby some argue that a statutory definition of charity is necessary to ensure clarity and consistency in the regulatory framework, while others contend that it could limit the scope of charitable activities and restrict innovation. The advantages and disadvantages to legislating a statutory definition were considered.

When asked for examples of organizations that would not meet the current requirements for registration, the following examples were provided:

• Sports organizations
• Organizations offering safe injection sites for illegal substances
• Organizations carrying out economic aid and development
• Organizations that prevent poverty

It was further noted that starting over with a 21st century statutory definition of charity may help address some issues concerning purposes vis à vis Indigenous Peoples or communities. Some members were interested in having a detailed discussion concerning a statutory definition of charity and what an inclusive and modern definition could look like, whereas others felt this would be a significant investment of time and resources with little to no chance of success to make any substantive changes.

Bruce MacDonald closed the meeting, thanking all the members.

March 31, 2023

Sharmila opened with a land acknowledgement and encouraged members to participate in the language of their choice. Sheherazade opened the meeting with a roundtable discussion where she invited members to share their thoughts and views from the previous day.

She offered the following questions for consideration:

• What is the most important thing that was discussed (or not discussed) yesterday?
• What did you think about overnight?
• Do you have any thoughts you want to put on the table?

The roundtable discussion offered a variety of feedback from members. It was observed that it would be impossible for the Minister to appoint a committee that is fully representative of the 86,000 registered charities in the charitable sector, but that everyone around the table was appointed so that the sector has a voice. The Committee agreed that it needed to re-evaluate and clarify its priorities in advance of the June meeting.

Sharmila advised the Committee that the Directorate would appreciate feedback on the following issues, noting that input on these items could lead to substantive changes for the sector as it is within her administrative purview to undertake these changes:

• Client services
• Call centres
• Written enquiry services
• Website accessibility
• Registration process

Relationship between the CRA and the charitable sector working group (CRACSWG) Exercise

Owen Charters led an exercise on behalf of the Relationship between the CRA and the charitable sector working group where he asked the Committee what would improve the registration or client service processes for charities.

There was a substantive discussion about the working group’s current priorities and ultimately, the ACCS agreed this working group would narrow its focus to the following two key issues:

1. Review of the charities registration process, including a consideration for consultations with the sector
2. Review of ACCS Reports #1, 2, and 3 to seek greater clarity on the status of these items from the CRA

Transparency and data related to other qualified donees and non-profit organizations working group (TDWG) Exercise

Kevin McCort provided an update on the group’s work to date on the following topics:

• other qualified donees;
• taxonomy of language around charities and non-profit organizations;
• T3010 form, Registered Charity Information Return, and T1044;
• and, Non-Profit Organization Information Return.

Kevin raised the following questions for consideration:

• How can an effort for greater data collection and accuracy through the required T3010 and T1044 forms be significantly advanced when long term structural issues prevent timely, critical improvements?
• Are we as a committee/working group looking for data in all the wrong places?
• What has been the impact on income and the outcome of charities through the pandemic?

The ACCS agreed that, generally speaking, taxonomies can be an endless source of frustration, and as a result, getting datasets related to certain organizations remains an ongoing challenge. The Department of Finance Canada noted that they would be interested in data or recommendations related to the T1044 if the ACCS wanted to pursue this issue.

Final thoughts and next steps

There was a brief discussion concerning whether or not the ACCS accomplished its objectives for this meeting. It was agreed that the co-chairs and working group leads should meet in the coming weeks to ensure there is a common understanding of next steps and expectations in advance of the June 2023 meeting.

Sheherazade Hirji, ACCS Sector Co-Chair, closed the meeting by thanking the members for donating their time to this meeting and all of their contributions. She left the members with a quote to think about:

The true meaning of life is to plant trees, under whose shade you do not expect to sit.