The Honourable François-Philippe Champagne, Minister of Finance and National Revenue, tabled the Spring Economic Update 2026 (the “Spring Update”) in the House of Commons on April 28, 2026. The Spring Update includes several measures relevant to the charity and not-for-profit sector, including a proposal to modernize tax rules for the charitable sector, confirmation of the government’s intention to proceed with certain previously announced measures impacting the sector, and various grants and funding measures for the sector.
Of particular note, the Spring Update proposes to modernize the framework for the charitable sector in 2026-27. Although the Spring Update does not contain any specific details regarding the framework, it states that the Government of Canada’s first step will be to seek feedback from key stakeholders and relevant agencies through a consultation. The general aim will be to align with best practices adopted by other G7 countries. It will be essential for the charitable sector to carefully monitor what the Government is planning to do with this modernization initiative.
As well, the Spring Update confirms the federal government’s intention to proceed with certain previously announced tax and related measures, as modified to take into account consultations and deliberations since their release. One such listed measure is the draft legislation released on January 29, 2026, for reporting by non-profit organizations under paragraph 149(1)(l) of the Income Tax Act (ITA) and by agricultural organizations, boards of trade and chambers of commerce under paragraph 149(1)(e) of the ITA. This proposed legislation was discussed in further detail in the February 2026 Charity & NFP Law Update.
The federal government has also confirmed its intention to proceed with the legislative proposals released on August 12, 2024, and subsequently set out in the 2024 Fall Economic Statement regarding charities and qualified donees. As previously reported in Charity & NFP Law Bulletin No. 530, those proposals include amendments to section 149.1 of the ITA concerning registered foreign charities that are qualified donees, including a new definition of “registered foreign charity,” extending the registered status period from 24 months to 36 months, and requiring registered foreign charities to file an information return.
In addition to these measures, the Spring Update refers to several grants and funding measures involving community organizations, community safety, and food security, including the following:
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- Community Volunteer Income Tax Program Grant:a proposed $18.7 million over three years, starting in 2026-27, for the Canada Revenue Agency to renew and expand the Community Volunteer Income Tax Program Grant, which supports community organizations that host free tax preparation clinics for individuals with modest incomes and simple tax situations.
- Canada Community Security Program:The Spring Update proposes $75 million over five years, starting in 2026-27, for Public Safety Canada to continue supporting eligible organizations, which may include places of worship, with physical security enhancements. This funding is noted in the context of rising hate-related crimes. Separately, as discussed in the March 2026 Charity & NFP Law Update, Bill C-9, the Combatting Hate Act, proposes amendments to the Criminal Code concerning hate propaganda, hate crime, and access to religious or cultural places.
- Food banks and food security:The Spring Update also refers to $20 million in previously announced funding to support food banks and other organizations that provide food assistance to families in need.
Separate from the Spring Update itself, charities and not-for-profits may also wish to note the ongoing pre-budget consultation process for the 2026 Federal Budget. As reported in the March 2026 Charity & NFP Law Update, the House of Commons Standing Committee on Finance launched its annual pre-budget consultations earlier this spring. The Committee has since extended the deadline for submitting written briefs beyond the original April 30, 2026 deadline until May 22, 2026, providing additional time for Canadians and organizations to participate. This extension gives charities and not-for-profits a further opportunity to raise sector-specific priorities and concerns for possible inclusion in the Committee’s report to Parliament for the 2026 Federal Budget.