Stop Terror-Financing and Tax Penalties on American Hostages Act

Floor Speech

BREAK IN TRANSCRIPT

Ms. McCOLLUM. Mr. Speaker, I rise in opposition to H.R. 9495, the Stop Terror-Financing and Tax Penalties on American Hostages Act.

This legislation would grant the Secretary of the Treasury the unilateral authority to suspend the tax-exempt status of any organization deemed ``terrorist supporting'' without due process or evidence. U.S. law already prohibits nonprofits from providing material support to terrorists. Additionally, I am deeply concerned about how this legislation could provide President-elect Trump's incoming administration with unchecked power to cause irreparable damage to any nonprofit he deems a threat to his own political agenda. This could be disastrous for nonprofits across the country, including those doing important work in the Fourth District like Springboard for the Arts, the Playwrights' Center, and the Center for Victims of Torture. More than 120 civil society groups--including the ACLU, the American Federation of Teachers, the NAACP, and the League of Conservation Voters--signed a letter opposing this bill due to the potential for abuse. I include in the Record this letter. I stand with them, and I encourage my colleagues to do the same. September 20, 2024. Hon. Mike Johnson, Speaker, House of Representatives, Washington, DC. Hon. Hakeem Jeffries, Democratic Leader, House of Representatives, Washington, DC.

Dear Speaker Johnson and Leader Jeffries: We write to express our deep concerns with H.R. 9495, the Stop Terror- Financing and Tax Penalties on American Hostages Act. Specifically, this bill includes the text of H.R. 6408, legislation we strongly oppose as it raises significant constitutional concerns. Because H.R. 6408 vests vast unilateral discretion in the Secretary of Treasury, it creates a high risk of politicized and discriminatory enforcement. The executive branch already has extensive authority to prohibit transactions with individuals and entities it deems connected to terrorism and nonprofit organizations are already prohibited from providing material support to terrorist organizations. In fact, it would be a federal crime for them to do so.

Moreover, we do not oppose the provisions in H.R. 9495 that relate to preventing the IRS from imposing fines and penalties on hostages while they are held abroad. Indeed, these provisions have already passed the Senate on their own, and if the House of Representatives were to pass a version of this bill that did not include the text of H.R. 6408, it could be sent immediately to the President for his signature.

Without any evidence as to the need for this legislation, H.R. 6408 authorizes broad and easily abused new powers for the executive branch. It grants the Secretary of the Treasury virtually unfettered discretion to designate a U.S. nonprofit as a ``terrorist supporting organization'' and to strip it of its tax-exempt status if the Secretary finds that the nonprofit has provided material support to a terrorist group, even if the ``support'' is not intentional or connected to actual violence.

While the sponsors of this legislation have stated that it is needed to avoid what they refer to as ``time-consuming bureaucratic process'' under current law, what the bill sponsors are actually seeking to avoid is fundamental due process. If this bill were to become law, the Secretary of Treasury could strip a US nonprofit of its tax-exempt status without providing the nonprofit a meaningful opportunity to defend itself before a neutral decisionmaker. The legislation further does not require disclosure of all the reasons for such a decision or the evidence relied upon to support it. Nor would the government be required to provide any evidence in its possession that might undermine its decision, leaving an accused nonprofit entirely in the dark about what conduct the government believes qualifies as material support.

The potential for abuse under H.R. 6408 is immense as the executive branch would be handed a tool it could use to curb free speech, censor nonprofit media outlets, target political opponents, and punish disfavored groups across the political spectrum. Moreover, the addition of this authority to the tax code would allow the IRS to explicitly target and harass domestic nonprofits using its investigative authority. It is also not hard to imagine a future administration using this power in far broader circumstances that have nothing to do with the hostilities in Gaza. And as more recent congressional oversight efforts make clear, these efforts are part of concerted attack on civil society that is targeted at more than just groups involved in the campus protests regarding Gaza. The executive branch could use this authority to target its political opponents and use the fear of crippling legal fees, the stigma of the designation, and donors fleeing controversy to stifle dissent and chill speech and advocacy. And while the broadest applications of this authority may not ultimately hold up in court, the potential reputational and financial cost of fending off an investigation and litigating a wrongful designation could functionally mean the end of a targeted nonprofit before it ever has its day in court.

The lack of guardrails creates the potential for future administrations to weaponize these powers against groups on both ends of the ideological spectrum. Even if they may never be designated as ``terrorist-supporting,'' let alone charged with a crime, nonprofits will curtail their activities as a precaution in order to avoid stigmatizing and financially devastating punishments. That is why we strongly urge you to oppose the inclusion of H.R. 6408 in H.R. 9495. Sincerely,

#WelcomeWithDignity, 18 Million Rising, Advocacy for Principled Action in Government, Alliance for Peacebuilding, American Atheists, American Civil Liberties Union, American Federation of Teachers, American Friends Service Committee, American Oversight, Americans United for Separation of Church and State, Amnesty International USA, Anethum Global, Arab American Institute (AAI), Asian Americans Advancing Justice | AAJC, Asian Law Caucus, Aunties Coalition, Ayuda, Bend the Arc: Jewish Action, Borderlands Resource Initiative, Brennan Center for Justice at NYU School of Law.

Center for American Progress, Center for Civilians in Conflict (CIVIC), Center for Common Ground, Center for Constitutional Rights, Center for Democracy & Technology, Center for International Policy, Center for Media and Democracy, Center for Popular Democracy, Center for Victims of Torture, Charity and Security Network, Chinese for Affirmative Action, Citizens for Responsibility and Ethics in Washington (CREW), Civil Liberties Defense Center, Coalition for Civil Freedoms, Coalition for Humane Immigrant Rights (CHIRLA), COLAGE, Colorado Immigrant Rights, Coalition Color of Change, Community Change Action, Council on American- Islamic Relations.

DAWN, DC Volunteer Lawyers Project, Defending Rights & Dissent, Demand Progress, Democratic Messaging Project, EarthRights International, Earthworks, Emgage Action, Empowering Pacific Islander Communities, Ensaaf, Equality Federation, Evangelical Lutheran Church in America, Faith in Action, Food Shift, Free Press Action, Freedom of the Press Foundation, Friends Committee on National Legislation, Friends of Human Rights, Greenpeace USA, HEART.

Hindus for Human Rights, Human Rights First, Human Rights Watch, ICNA Dallas, Immigration Hub, Indivisible, International Civil Society Action Network (ICAN), International Jewish Anti-Zionist Network, International Refugee Assistance Project (IRAP), Islamic Association of The Colony, Islamic Center of Quad Cities, Just Foreign Policy, League of Conservation Voters, McKinney Islamic Association, Medical Center Islamic Society, Middle East Democracy Center (MEDC), MLFA, MoveOn, MPower Change Action Fund, Multicultural Center.

Muslim Advocates, Muslim Counterpublics Lab, Muslim Justice League, Muslims for Just Futures, NAACP, National Council of Asian Pacific Americans, National Disabled Legal Professionals Association, National Education Association, National Immigration Law Center, National Iranian American Council Action, National Lawyers Guild-Mesoamerica subcommittee, National LGBTQ Task Force Action Fund, National Network of Abortion Funds, National Women's Law Center, NETWORK Lobby for Catholic Social Justice, New Georgia Project Action Fund, New Israel Fund, North American Indian Muslim Association, NTIC, Oil Change International.

Organization for Identity & Cultural Development (OICD.net), Othman Bin Affan Mosque, OPAWL--Building AAPI Feminist Leadership, Oxfam America, Palestine Legal, PASNY, Peace Action, Peace Appeal Foundation, Peace Catalyst International, Peace Direct, People for the American Way, People's Action, Planned Parenthood Federation of America, Plus, Positive Women's Network-USA, Presbyterian Church (USA), Office of Public Witness, Project On Government Oversight, Project South, Protect Democracy, Public Citizen.

Refreshed Refined Reformed R3 Inc, Reproductive Freedom for All (former NARAL Pro-Choice America), Restore the Fourth, September 11th Families for Peaceful Tomorrows, Shoulder to Shoulder Campaign, Southern Poverty Law Center, Stop AAPI Hate, The Interfaith Center of New York, The Seed Program by Kai, Inc., The Sikh Coalition, The United Methodist Church-- General Board of Church and Society, The Workers Circle, The X-Lab, Tides Center, Tides Foundation, Unitarian Universalist Service Committee (UUSC), US Campaign for Palestinian Rights Action (USCPR Action), Win Without War, Women for Weapons Trade Transparency, Women's March.

BREAK IN TRANSCRIPT

Source