Recognizing change: A program for the reform of the taxation of the third sector in Canada

This paper argues that Canadian tax law should be reformed in order to encourage engagement by the third sector in the political arena, both domestically and internationally, and, specifically, that: (1) the deduction for contributions to third sector organizations should be limited to the deduction that is allowed, if any, for contributions to political parties; (2) any government funding for services provided by third sector organizations should be transparent; and (3) the income tax exemption should be available to third sector organizations engaged in non-partisan political activities, both domestically and internationally; but (4) income from directly-conducted business activities of third sector organizations should (as in the United States, but not as proposed in the U.K.) be taxed.