Kustoff Bill to Revoke Tax-Exempt Status to Nonprofits Supporting Terrorists Passes House

WASHINGTON, D.C — Today, Congressmen David Kustoff (R-TN) and Congressman Brad Schneider's (D-IL) bipartisan bill, H.R. 6408, passed the House of Representatives. This critical legislation would revoke the tax-exempt status for any organization that provides financial support or resources to designated terrorist groups.

This bill passed the House by a bipartisan vote of 382-11. Congressman Kustoff spoke on the floor of the House of Representatives in favor of this legislation.

Click here to watch his remarks or read them as prepared below:
Thank you, Mr. Speaker.

I do want to thank Chairman Jason Smith (R-MO) not only for his leadership on this bill, but also for this support. 

H.R. 6408 is an important, bipartisan piece of legislation that will revoke the tax-exempt status for any organization that provides financial support or resources to designated terrorist groups, such as Hamas or Hizballah. 
 
I’d like to thank my colleague, Rep. Brad Schneider, for joining me in introducing this very important bill.
 
Since Hamas’ barbaric attack on Israel, we’ve seen a dramatic rise in antisemitism and anti-Israel motivated attacks here at home and around the world. 
 
Iran’s recent attack on our ally, Israel, was a stark reminder of why we must confront Iran and its terrorist proxy groups.
 
These same groups have also increased attacks on American troops in the region. 
 
Acts of terror, anywhere in the world, will not be tolerated. 
 
A crucial pillar in the global fight against terrorism is dismantling the financial networks of terrorist organizations. 
 
Without access to resources and funding, terrorist organizations are seriously restricted in their ability to carry out attacks in the first place. 
 
Recent reports indicate there are U.S.-based nonprofits that are suspected of providing support and funding to terrorist groups.
 
Many of these organizations have special 501(c)(3) tax-exempt status which allows their donors to claim a tax deduction.
 
To put it plainly, domestic financers of terrorism are currently being subsidized by U.S. taxpayer dollars.
 
Let me be clear: No American should receive a tax benefit for funding terrorism. 
 
Right now, our ability to crack down on tax-exempt organizations that support terrorism is inadequate.
 
Doing so, under current law, requires a time-consuming bureaucratic process that has sometimes prevented federal authorities from acting.
 
That is why we introduced this crucial legislation that we are voting on today. 
 
This legislation will authorize the U.S. Treasury to revoke the tax-exempt status of any organization deemed to have provided material support or resources to a designated terrorist group within the past three years.
 
Material support includes financing, services, training – any tangible or intangible aid that helps terrorist groups advance their objectives.
 
Under no circumstance should organizations that support terrorism be allowed to receive preferential treatment under the U.S. tax code. 
 
This bill is a crucial step towards dismantling the financial networks of terrorist organizations across the globe, including Hamas, Hizballah, and the Islamic Revolutionary Guard Corps.
 
I urge all my colleagues to support this important, bipartisan piece of legislation that will bring us one step closer to eradicating terrorism around the world.
 
With that, Mr. Speaker, I thank you and I yield back.

Click here to read the full text of the bill. 

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