Charitable Status: Financial Support to State Military Versus Terror Groups

"Our position is that it is unjust for the Canada Revenue Agency [CRA] to revoke a charity because a charitable object[ive] that it accepted almost 60 years ago is now no longer considered to be a valid charitable object[ive]." 

"It is simply unjust to close a charity supported by over 100,000 Canadians based on reversing a decision the CRA made in 1967."

Nathan Disenhouse, national president, JNF Canada

 

"In keeping with our mission of improving the quality of lives of Israelis, we have in the past funded projects of a charitable nature that indirectly involved the IDF. These projects were built on land owned by the IDF primarily for the benefit of children and youth. When it came to our attention several years ago that supporting these types of projects may not be in keeping with CRA policies, we stopped funding them."

"The last project we funded was in June 2016 and it was directed to the Hatzerim Airforce Base for a playground/soccer field for the children living on the base."

"To be clear, we no longer fund projects located on IDF land and JNF Canada operates in accordance with CRA regulations governing its status as a charitable organization."

JNF CEO Lance Davis

Israeli air force cadets toss their caps into the air during a graduation ceremony at the Hatzerim air force base in southern Israel in 2014. A Canadian charity that funds projects in Israel has faced claims that some of its charitable donations have gone to support projects on Israeli military bases in violation of Canadian tax rules. (Tsafrir Abayov/Associated Press)

 

The century-old Jewish National Fund has been advised by the Canada Revenue Agency that its charitable status in Canada is set to be revoked in view of the charity's financial support for Israel's military structure. In response, the Jewish National Fund has made it clear that its intention is to challenge that decision in a court of law. Its contention is that the rules of charitable donations have been altered by the CRA, and that after the organization's work had been approved for charitable status under those same rules 60 years earlier.

It  is more than slightly likely that this move by the CRA was developed in the wake of Jewish groups bringing to the attention of the Canada Revenue Agency, and to Canadian media, that there are Canadian Muslim charities in good charitable status with the CRA known to financially support terrorist groups abroad. There is an obvious difference between a state's military apparatus and that of a terrorist militia. The latter's purpose is objectively offensive, while the former's is, by necessity, defensive.

A state that has been forced by regional circumstances throughout its history, to build an army for the specific purpose of self-defense is certainly not to be conflated with scores of militias formed for the single purpose of destroying an internationally recognized, legitimate, sovereign state. Differentiating between the two; state military/non-state militias, legitimate fighting force and purposefully terrorist entities shouldn't be too difficult to determine even by third-state functionaries.

"The CRA assesses all concerns about registered charities against a clear regulatory  and risk framework designed to prevent bias in our decision-making process", responded the agency spokesperson Nina Ioussoupova. Which has led the Jewish National Fund to embark on a legal journey with the intention of proving that the tax agency erred in making its decision; that not only is there an evident bias in its decision-making, but it has upended its own prior agreement with the charitable status and purpose of the Jewish National Fund.

And nor is the JNF the only Jewish organization that has come afoul of the CRA's shift to de-registering charitable status for other Jewish groups focused on financial aid used for the building of military infrastructure for the Israel Defense Forces. Simply put, their case is that "Canadian charities are not allowed to fund foreign militaries", explained Mark Blumberg, a Canadian lawyer whose specialty is Canadian charity law. 

In any event, although the CRA decision means a loss of status as a registered charity for the Jewish National Fund, its supporters and donors comprised for the most part of members of the Canadian Jewish community, should be able to overlook the loss of charitable receipts used for income tax purposes, since as a taxable relief they don't amount to very much. The principle of supporting a dedicated military tasked to protect civilian life in Israel should represent sufficient philanthropic motivation.

On the other hand, since the Jewish National Fund has attested that since 2016 it no longer funded IDF infrastructure, something is definitely awry with Canada Revenue Agency's audit and the decision that arose out of it. Not revealed was whether Islamic groups in Canada appealed to the CRA to rescind the charitable status of the JNF on the basis of its having funded said IDF infrastructure, but it is not entirely unreasonable to assume that this kind of incitement did have a desired effect in retaliation for the spotlight on Muslim charitable groups sponsoring terrorism.

A JNF Israel webpage describes Canadian-sponsored projects on Bat Galim Naval Base and Palmachim Airbase in Israel. (KKL-JNF)

"Unfortunately, our overtures to have a dialogue in order to negotiate an agreement were rejected --- CRA officials refused to meet in person with JNF Canada officials throughout this ordeal -- and the CRA confirmed its intention to revoke on June 25th."

"[Our appeal intends to illustrate that the Canada Revenue Agency's findings are flawed; the federal agency's taxation arm's processes are unfair, that there] is a reasonable apprehension of bias in the audit."

Jewish National Fund letter: Nathan Disenhouse and JNF CEO Lance Davis