Canada Leaves Greenpeace Red-Faced
No less a green haven than Canada just dealt the Dutch-based environmentalist group a massive blow to its credibility and fundraising efforts by denying it the charitable status it had sought for a decade.
Revenue Canada, the tax-collecting arm of the government, has refused to recognize the new Greenpeace Environmental Foundation as a charity, saying its activities have “no public benefit” and that lobbying to shut down industries could send people “into poverty.”
By doing this, Revenue Canada has performed a useful service. Its decision has sent a strong signal to the world’s green pressure groups that their tax and other benefits resulting from their status as “charities” deserves reconsideration. Canada is the first country to implicitly recognize Greenpeace as the most successful of the multinational anxiety corporations. Whether any EU country has the guts to follow Canada’s lead, and strip Greenpeace of its charitable facade, is alas another matter.
Greenpeace was launched in Vancouver nearly 30 years ago with an anti-nuclear ‘Don’t Make A Wave” campaign and was registered as a charity in 1976. Since then it has grown into a multi-national, multi-million dollar operation devoted to promoting green causes around the world. But in 1989, Greenpeace lost its Canadian charitable status amid concerns that it was not a true charity-that is, that it was not providing a discernible benefit to the public. As such Greenpeace was no longer able to claim tax exemption on its revenues and donors could not claim deductions, which resulted in some donors switching to real charities that did give tax breaks.
The organization responded by setting up the Greenpeace Canada Charitable Foundation, legally (thought not really functionally) distinct from Greenpeace. But according to court records made public in June by John Duncan, the Reform MP from British Columbia, the federal charities division found the group’s activities “have not complied with the law” on charitable organizations.
“This opinion resulted from an audit which raised serious concerns about the charity’s compliance with the Income Tax Act. The audit revealed that the charity had failed to devote all its resources to charitable activities,” Mr. Duncan said recently in a public statement. Of particular concern were the financial links between the Greenpeace International and Greenpeace Canada. Hundreds of thousands of dollars were transferred between the organizations, which may violate Canadian laws on charitable activities. Officials were also concerned because the charity appeared to be a fund-raising conduit for Greenpeace, which is not permitted in Canada.
Consequently, the second Greenpeace venture lost its charitable status in 1995. The group launched a court appeal, which was dismissed in September 1998. But by then a new charity called the Greenpeace Environmental Foundation had sprung forth like the regenerated head of a Hydra. Revenue Canada called the latest charity “a
convenient way to avoid the consequences” of its past troubled charities and declined to register the group. Greenpeace appealed against the decision but eventually threw in the towel.
Revenue Canada explains that preserving the environment is recognized as a charitable activity, but that the Greenpeace foundation does not qualify because its stated purpose is “public awareness.” According to a spokesman from Revenue Canada this poses a problem since “we have no evidence that the distribution to the public of a pamphlet on, for example, the destruction of forests (along the Amazon or the B.C. coast) or on the various pollutants emanating from smokestacks has any measurable impact on the environment.”
However it is widely believed that the decision against Greenpeace has more to do with its extensive lobbying against Canadian forestry exports, than Revenue Canada’s ‘Public Awareness’ issue.
Without charitable status, Greenpeace cannot offer tax receipts to its donors. The Canadian Greenpeace Charitable Foundation is already running at a loss (over $250,000 in 1996-97 and slightly less last year), and non-tax exempt donations will be harder to come by in the future.
Greenpeace made light of the Canadian decision however. “I don’t think Greenpeace is going to be made a charitable organization, and we seem to be doing okay without charitable status,” said Peter Tabuns, Greenpeace’s Canadian executive director. Mr. Tabuns can be sanguine about the decision since the financial dealings described by Revenue Canada suggest Greenpeace’s Canadian operations are increasingly being funded from its much richer European operation. Greenpeace world-wide receives over two thirds of its funding from Germany and Holland, and Canada does not appear on Greenpeace’s summary chart of donations (but it does appear on the expenditure chart in recent years). Therefore, Revenue Canada’s decision will not cause a big cut in Greenpeace’s global coffers.
Nevertheless, Canadians seem less inclined these days to go along with Greenpeace crusades. In an effort to curtail Canada’s lucrative logging business, activists placed a giant sign for Home Depot, the United States-based hardware giant, in a recently logged area, which they claim was ancient forest, north of Vancouver. The group then issued a statement calling Home Depot a “major player in the destruction of the world’s remaining ancient forests.” Such rhetoric no longer seems to appeal to Canadians since donations to the Greenpeace charity had fallen by 15% in 1997, the last year of published financial records. Furthermore, many politicians who initially welcomed environmental sentiments have become inured to the scaremongering and have decided not to oppose the Reform Party’s anti-Greenpeace stand.
There is plenty of “clear blue water” between Canada and Europe, however. Greenpeace’s European operations are far wealthier and receive the blessing of most of Europe’s left-wing governments. Greenpeace has mounted its most successful campaigns in Europe, where politicians abhor confrontation with pressure groups and try and appease them as much as possible. French attitudes have softened since 1985, when their Secret Service blew up the Greenpeace ship Rainbow Warrior in Auckland Harbour. To be fair, European politicians are not given much support by business, which is becoming increasingly defensive, or the media, which thrives on scare stories.
Such official deference-the assumption that Greenpeace is always on the side of angels-looks increasingly out of touch. The recent Greenpeace campaigns against PVC plasticisers and dioxins in Belgian chickens did a disservice to the public in obscuring the scientific evidence and fomenting the kind of panic that harms the public good and hurts consumers in the long run, since it unnecessarily raises producer costs. It was hard to find a single news story that mentioned the concentration of the alleged contamination-a fundamental scientific point, if the allegations of a threat to human health were to have any validity. In fact, dioxin and other organochlorine compounds may cause cancer when fed to laboratory rats in massive concentrations, but have no observable effect on humans at the actual levels found.
Perhaps we will have to wait for Greenpeace-inspired environmental regulations to cause even greater European unemployment and unrest from before our politicians follow the Canadian government’s example. Environmental multinationals such as Greenpeace should be free to pursue their agenda in democratic society-but it’s time governments stopped giving this particular lobby preferential treatment.