http://decisions.fca-caf.gc.ca/fca-caf/decisions/en/item/98040/index.do 
Blackmore v. Canada (September 24, 2014 – 2014 FCA 210) is a decision of the Federal Court of Appeal affirming a decision of the Tax Court:
http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/31278/index.do
which held that the polygamist Mormon community at Bountiful, British Columbia was not entitled to benefit from the “communal organizations” rule in subsection 143(1) of the Income Tax Act.
The appellant, Mr. Blackmore was the leader of the community. The Tax Court described the consequences if he were to be successful in his appeal:
[6] If the Appellant’s position is correct, and section 143 applies, it will have far-reaching implications for not only the Appellant, but also the members of Bountiful. The provision will operate to deem the existence of an inter vivos trust which would be superimposed upon the community. This means that, for tax purposes, all of the assets and property of the congregation, or of any business agency of the congregation, are deemed to be the assets and property of the deemed trust. Consequently, any income from property or business activities of the congregation will be deemed to be the income of the deemed trust. Since business agencies of the congregation are deemed to have acted as agents of the deemed trust in all congregational matters, their income from business activities will also be deemed to be income of the trust.
[7] Subsection 143(2) then permits a qualifying congregation to make an election to have its income allocated among the members of the congregation. The election, to make a deemed distribution of the income of the congregation among its members, means that the income will be taxed in the hands of its members. Of course, if the income were to be left in the deemed trust, it would be subject to tax at the highest marginal rate applicable to individual taxpayers but, where it can be allocated equally among community members, those individual taxpayers will be subject to their personal graduated tax rates and exemptions.
[8] If section 143 applies in these appeals, the Appellant’s tax burden would be shifted to the members of Bountiful. The Company, in that instance, would be viewed as an agent of the community or an extension of the congregation, holding its assets, property and income for the benefit of the entire congregation and its members. Allocation of income across the qualifying membership in a community recognizes the lack of personal ownership of property and assets, which would be in accordance with the intent and purpose of section 143, and would eliminate any potential for double taxation that would occur with assessments pursuant to subsections 15(1) and 6(1) of the Act.
The Tax Court judge had made a finding that the members of the Bountiful community were not required to hold all property communally and therefore did not meet an essential requirement of section 143:
iii) Paragraph 143(4)(c) of the definition [of congregation] – “that does not permit any of its members to own any property in their own right”. This condition is met only by a community that does not permit its members to own their own property, whether the prohibition against private ownership is found in articles of incorporation or in the religious doctrine or practices of the community.
The Bountiful community does not in any way prohibit its members from owning their own property. On the contrary, the evidence is that members of the Bountiful community are permitted to own property and to exercise their property rights, and that they do so. Members of the Bountiful community may accept directives from Mr. Blackmore as to the disposition of some of their property, and members are expected to tithe (donate 10% of their income to the community). However, that is not inconsistent with the private ownership of property by members. Indeed, the practice of tithing assumes that members own their own property. A community does not need to ask or require its members to tithe if the members do not own their own property, or if all property is owned communally.
The Court of Appeal declined to interfere with this finding:
[9] In my view, the analysis and conclusion of Justice Campbell with respect to paragraph (c) of the definition – “that does not permit any of its member to own any property in their own right” – is particularly strong. I conclude that Justice Campbell interpreted paragraph (c) of the definition correctly, and that she made no palpable and overriding factual error in applying that provision to the evidence that was before her. It follows this appeal cannot succeed.
In so doing the court also rejected three arguments of Mr. Blackmore attacking the Tax Court decision:
[11] Mr. Blackmore argues that Justice Campbell’s interpretation fails to give effect to the purpose of section 143, which in Mr. Blackmore’s view is to provide tax relief for a community that, for religious reasons, has adopted the kind of shared or communal property regime that exists in the Bountiful community which, according to Mr. Blackmore, espouses communal property as an ideal although the ideal is not fully practiced. I do not accept this argument. I see no basis for concluding that the purpose of section 143 is as general or as generous as Mr. Blackmore contends, given the relatively specific and narrow language chosen by Parliament. In my view, paragraph (c) of the definition of “congregation” cannot reasonably bear the broader interpretation for which Mr. Blackmore contends.
[12] That conclusion also disposes of an alternative argument asserted by Mr. Blackmore for the first time in this Court. He argues that the statutory definitions are so ambiguous as to engage the principle that statutory provisions must be interpreted consistently with the values of the Canadian Charter of Rights and Freedom (specifically, freedom of religion and equality). The requisite ambiguity exists only if the provision in issue can reasonably bear more than one interpretation (Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 20, [2002] 2 S.C.R. 559, at paragraphs 28 and 29). In my view, that cannot be said of paragraph (c) of the definition of “congregation”. (Mr. Blackmore did not challenge the constitutionality of section 143 in this Court or in the Tax Court.)
[13] Mr. Blackmore argued that Justice Campbell erred in adopting an interpretation of section 143 that fits only traditional Hutterite communities. I see no merit to this argument. As I read the reasons of Justice Campbell, she expressly and properly rejected the argument of the Crown that the traditional Hutterite communities should be considered the “gold standard” for the application of section 143. She correctly noted that section 143 was enacted in response to the decision of the
Federal Court in Wipf v. Canada, [1973] F.C. 1382 (affirmed by this Court, [1975] F.C. 162, and the Supreme Court of Canada, (1976) 7 N.R. 549). In her discussion of paragraph (c) of the definition of “congregation”, she compared certain characteristics of the Bountiful community to the characteristics of traditional Hutterite communities as described in those cases. However, she did not say or imply that only a traditional Hutterite community could meet that statutory condition.
As a result the appeal was dismissed with costs.