February 2021 Charity & NFP Law Update
Published on February 25, 2021
By Ryan M. Prendergast
Bill C-256 Could Offer Capital Tax Exemption for Charities, but Includes a Fiscal Cost
A private member’s bill introduced to Parliament in November could provide additional relief from tax and a new source of revenue for Canadian charities. Mr. Marty Morantz, M.P., tabled Bill C-256, An Act to amend the Income Tax Act (donations involving private corporation shares or real estate), in the House of Commons on November 26, 2020. Bill C-256 proposes to amend the ITA so that charities can receive donations of real estate and privately-held shares without being subject to capital gains tax. A cost estimate report published on January 25, 2021, available on the website of the Parliamentary Budget Officer, estimates the fiscal cost of the Bill at $42 million in 2020–21, rising eventually to $198.8 million in 2024–25. On the other hand, the financial benefit to charities would be significant, with additional donations “due to behavioural effects of the policy” at $53.2 million in 2020–21 and $250.8 million in 2024–25; total donations that could benefit from the policy would rise from $212.2 million to over $1 billion in the same time period.
Bill S-222, the Effective and Accountable Charities Act
Promising changes may be on the way concerning how charities can use their resources in conjunction with other organizations that are not qualified donees under the ITA. Bill S-222, the Effective and Accountable Charities Act received first reading in the Senate on February 8, 2021. More information is available in Charity & NFP Law Bulletin No. 486.
Exemptions to Police Record Checks Reform Act Reconsidered for Removal
Ontario’s Ministry of the Solicitor General is considering whether to narrow or remove certain exemptions to police record checks. Ontario Regulation 347/18: Exemptions, filed under the Police Record Checks Reform Act, 2015 applies temporary exemptions to specific sectors and positions, such as police officers, correctional officers, child care workers and personnel in financial services oversight. A consultation document posted on the Ontario Regulatory Registry website on February 10, 2021 “seeks feedback from stakeholders on how the proposed changes to the current exemptions may affect different sectors.” The temporary exemptions are set to expire on July 1, 2021. Although it is not anticipated that proposed changes to the temporary exemptions in O Reg 347/18 would result in new costs or significant changes in how police record checks are conducted, the Ministry encourages feedback from affected sectors from their perspective.
Read the February 2021 Charity & NFP Law Update
