'Nonprofit Killer' Pulled From GOP Tax Bill—For Now

While welcoming the removal of legislation in House Republicans' budget reconciliation package that would empower U.S. President Donald Trump's administration to revoke the tax-exempt status of any nonprofit it deems supportive of a terrorist organization, rights groups on Monday urged vigilance, warning that GOP lawmakers could slip the contentious provision back into a future draft of the legislation.

In an unusual late Sunday night session, the House Budget Committee voted 17-16, with four Republicans voting "present," to advance the One Big Beautiful Bill Act—named in an act of GOP fealty to Trump's description of the proposal—which would extend the president's 2017 tax cuts that have disproportionately benefited ultrawealthy households and corporations while slashing vital social programs upon which tens of millions of people rely.

The latest version of the proposal no longer contains an amendment based on the language of the Stop Terror-Financing and Tax Penalties on American Hostages Act, or H.R. 9495—which critics have dubbed the "nonprofit killer."

"The removal of the nonprofit killer bill from the House Republicans' advanced tax package is a promising sign, not a victory."

According to the advocacy group Free Press Action, the bill allows the treasury secretary "to accuse any nonprofit of supporting terrorism—and to terminate its tax-exempt status without due process."

Civil liberties defenders say the proposal's lack of clarity regarding the determination of whether and how a nonprofit supports terrorism would enable Trump to follow through on his threats to cancel the tax-exempt status for organizations with which he disagrees, including universities, advocacy groups, media outlets, charities, religious institutions, and others.

Organizations that support Palestinian rights or oppose Israel's annihilation of Gaza—which is the subject of an International Court of Justice genocide case—have been particularly concerned about the bill, citing the Trump administration's moves to defund universities and other institution that oppose crackdowns on Gaza protests and the arrest and detention of foreign nationals, including green-card holders, for constitutionally protected protests.

While welcoming the removal of the measure from the reconciliation package, groups including the Council on American-Islamic Relations (CAIR) warned of the possibility that Republican lawmakers could re-insert the provision in the reconciliation package, which is scheduled for consideration by the House Rules Committee later this week.

"The removal of the nonprofit killer bill from the House Republicans' advanced tax package is a promising sign, not a victory," CAIR government affairs director Robert S. McCaw said Monday. "This provision could come back at any time, and if Americans want to preserve the right of nonprofits to speak truth to power, now is the time to flood Congress with messages demanding they keep this language out of the bill."

"We are defending nothing less than the future of nonprofit advocacy and our core constitutional freedoms," McCaw added.

While it is uncertain why the proposal was removed from the reconciliation bill, ACLU senior policy counsel Kia Hamadanchy told The Intercept that "it's possible they took it out to rewrite it in some way, because we know that this package is going to be amended."

"But for now, it's not in the text of the bill, and that's an improvement from where we were at last week," Hamadanchy added.

Addressing everyone who contacted their federal lawmakers or took other action in opposition to the bill, the digital rights group Fight for the Future said on the social media site Bluesky that "pressure from YOU is making a difference."

"We killed this bill in the fall, but because authoritarians love using censorship to silence opposition, it's likely gonna keep rearing its head," the group added, referring to the legislation's failure to receive a Senate vote before the previous congressional term ended.