India Revokes Prominent Think Tank’s Tax Exemption For No Good Reason (except Politics)
In the United States, the most prominent think tanks include Brookings Institution, The Heritage Foundation, Council on Foreign Relations, Cato Institute, Center for Strategic and International Studies, American Enterprise Institute, RAND Corporation, Carnegie Endowment for International Peace, Atlantic Council, and the Hoover Institution. All have perceived political leanings — conservative, libertarian, centrist, neo-conservative, liberal or progressive. It would be big news if one day the IRS revoked any one of those institutions’ tax exemption. It would be even bigger news if the revocation seemed motivated by a think tank’s perceived political leanings. All the tax, think tank, nonprofit and free speech constituents, especially, would be trying to figure out why and whether the Service had gone too far. There would eventually be Congressional hearings, trust and believe.
I am no expert, but I get the feeling that is sort of what’s happening in India, though I don’t know what motivates congressional hearings there. The Income Tax Department revoked the Centre for Policy Research’s 50 year old tax exempt status last week for silly reasons that probably serve only to ineffectively disguise the Government’s antipathy towards left leaning academia, which all academia must be, incidentally, since it is by nature question, inquiry and confrontation — “truth to power” and all that. The instinct to deconstruct the status quo is liberal or leftist, I think. The instinct to support the status quo is conservative or rightist. Academia is always deconstructive and thus will always be perceived as leftist. Prove me wrong. Anyway, CPR is one of India’s most prominent think tanks. Its Boards have included prime ministers, Supreme Court Chief Justices, and other prominent people, according to this essay:
Founded in 1973 by the economist V.A. Pai Panandiker, CPR employs scholars, diplomats, practitioners, former Army officers, and journalists to conduct research on high-stakes public policy issues. It counts among its alumni and board members three former prime ministers — Manmohan Singh, I.K. Gujral, and Narasimha Rao — a former Chief Justice of India (Y. V. Chandrachud), high-ranking government secretaries, foreign secretaries, distinguished Ambassadors as well as senior editors of India’s top newspapers.
CPR is either the Harvard, Yale or Stanford of India’s think tanks and yet somebody in India’s halls of power is very mad about it. For most of its history since independence, Indian government has been consistently suspicious of any type of foreign presence. India was a highly colonized place for a large part of its history so maybe that’s understandable. And since the mid-70s, India has exhibited growing hostility towards international civil society. CPR recently got swept up in what seems an crackdown on foreign funding of NGOs. Basically, Oxfam-India received money from abroad and made a grant to CPR. The government got wind of that and revoked both organizations FARA type rights, including the right to receive donations from abroad. Here is some pretty thorough reporting by India’s Firstpost News:
After India revoked CPR’s license, CPR could no long accept funding from such prior foreign donors as the Bill and Melinda Gates Foundation, the University of Pennsylvania, the World Resources Institute and Duke University. I don’t know my way around India very well but it sounds as if that suspension is still in effect. One source says suspending CPR’s foreign donor license and revoking tax exemption all has to do with the “controversy around George Soros.” Another asserts that CPR’s impending “tragic” demise will have been the result of unspecified political controversies. While a third quotes the revocation notice as referring to improper associations with environmental activists, and doing nothing other than funding those organizations’ litigation and “complaining rather than doing research.” One provocative op-ed says the government’s action constitutes a politically motivated “death knell,” for the prestigious think tank:
Multiple reasons have been ascribed (as speculation, no more) to why the CPR became subject to the government’s adverse attention — strategic research that the powers took a dim view of, forays into areas that may potentially have hurt the government’s cronies, alignment to donors that are disliked by the Establishment and so on. All or none may be correct. The overriding reason there can be no uncertainty about, and it is this: CPR has paid the price for being aligned to the liberal (and therefore stained) ecosystem and for conducting its affairs with an unlicensed air of intellectual freedom.
. . .
Ashutosh Varshney, lead Political Science faculty member at Brown University and a deeply engaged commentator on Indian affairs, considers what he called “the attack” on CPR “very bad news”. Critical, even adversarial, work, Varshney argued, should be among the core ideas of institutions like CPR. “It is of course for CPR’s lawyers to challenge allegations that they are in violation of FCRA terms, although it must be said that the government is in an infinitely superior position in such cases. Institutions like CPR lose their very reason if they are deprived from being critical. These are folks trained to appraise and assess policy and often that has to be critical assessment, that is how democracies and democratic institutions function.”
I could not find any links to the actual revocation notice, but as far as I can tell, the Income Tax Department is relying on a commerciality rationale we Americans have seen expressed in Living Faith, Inc. v. Commissioner. The notice also asserted CPR subsidizes private authors since it does not retain ownership of books and other research results produced via CPR grants. We would call that improper private benefit. But CPR addressed that in a manner that sounds like our U.S. regulations on the necessity of making scientific research publicly available. The ease with which CPR explains the the asserted reason suggests the government is merely disguising its antipathy for academia inherently left leaning ways:
CPR had earlier said that, in 2022, it published 39 policy briefs, 31 peer reviewed journal articles, 10 working papers, four book chapters and one book, which is the core purpose of education and research. It said that in the spirit of its charitable status, CPR does not claim any ownership rights on the books or seek to draw any financial benefits, and the purpose is to contribute knowledge to society at large.
Here is CPR’s official public response:
darryll k. jones