TRENTON, Canada

Canada’s National Security and Intelligence Review Agency said Tuesday that it will investigate accusations of Islamophobia against the Canada Revenue Agency (CRA), the federal agency that collects taxes and administers tax laws for the Canadian government. 

The CRA’s audit of the Muslim Association of Canada (MAC), which began in 2015, could jeopardize the charitable tax status of MAC, Canada’s largest Muslim association.

The CRA’s review and analysis wing probes registered charities like MAC to ensure that donations are not being used to finance terrorism.

If the CRA believes that is the case, it can revoke an organization’s charitable license so that donors are not issued a tax receipt, impairing the organization’s ability to raise funds.

MAC launched a court challenge in 2022 to stop the audit, claiming the tax agency is biased and targets itself and other Muslim charities because the agency is “tainted by systemic bias and Islamophobia.”

“The audit would never have been approached in the way it has been had the organization in question been Christian, Jewish or Hindu,” said Geoff Hall, a lawyer at McCarthy Tetrault LLP, in a statement last April.

MAC also asked for an investigation of the CRA, and Tuesday, the National Security and Intelligence Review Agency announced its intention to do just that.

The intelligence agency said the review will focus on the CRA’s “national security activities and decision-making relating to registered Canadian charities, to assess their reasonableness, necessity and compliance with the law.”

But National Revenue Minister Diane Lebouthillier asked in 2021 that the charge of Islamophobia against the CRA be looked into. While the intelligence agency said it would look at all charities, the concern is MAC and similar organizations.

Lebouthillier said she has no problem with the probe.

"The government of Canada stands with and supports Muslim communities across Canada and reaffirms its commitment to take action to denounce and tackle Islamophobia, hate-fueled violence and systemic discrimination whenever and wherever it occurs," she said in a statement.