Lord Hodgson of Astley Abbotts has called for the scope of the lobbying act to be reduced to include only activity intended to influence how the public vote.
In his review of the act, commissioned by the government, the Conservative peer also calls for the period during which its rules apply to be reduced.
Hodgson's report, out today, also calls for some elements of the act to be tightened, and warns both charities and government that his recommendations should be taken as a package.
A report by the Commission on Civil Society and Democratic Engagement in September found the act had had the feared "chilling effect" on charities, leaving them unwilling to speak up for fear of breaking the law during the general election.
Hodgson's review, commissioned in January 2015, covers only part two of the legislation, which most affects charities and covers any activity which could be "reasonably regarded" as intended to influence voters.
He says in his report that this definition should be amended to reflect campaigning groups' actual intentions – so charities would only be in breach of the law if it could be shown they had meant to campaign in favour of a party or candidate.
"I think there are places where the shoe pinches too much and some places where the shoe doesn’t pinch enough, and I think a few amendments would make it a better act," said Hodgson at the report’s launch in Westminster today.
"My view is that part two of the act should tackle electoral campaigning, where you are seeking to influence voting intentions and it should be an issue of direct intent."
The law should not be left open to "someone else’s interpretation" of whether a group had tried to influence voters and said it should not apply to day-to-day advocacy work or attempting to raise awareness of an issue among politicians.
But he said there should be anti-avoidance measures in place.
His report says the 365-day period covered by the act for general elections is too long and recommends it be reduced to four months in line with the rules for European and devolved administration elections.
He also calls for the Electoral Commission’s online register to be improved, giving more information as to what the registered parties’ campaigning interests are.
The review was welcomed by charity bodies.
Sir Stephen Bubb, chief executive of the charity leaders body Acevo, said he was in favour of repealing the whole act, but acknowledged Hodgson’s review was "a good first step".
He said: "By ensuring that only that activity which intends to influence elections is regulated, we can ensure that charities are not unduly silenced.
"As such, we call on the government to implement the recommendations of the Hodgson review in full, and without delay – and take some steps towards righting the wrongs of their predecessors."
Sir Stuart Etherington, chief executive of the National Council for Voluntary Organisations, said the review was a "sensible package of reforms".
He said: "It will be important that these are implemented as a whole in order to ensure that the changes strike the right balance between effective and proportionate regulation and transparency around elections.
"I am particularly pleased that Lord Hodgson has seen fit to redefine the purpose test to ensure that regulations apply only to activity which is intended to influence voters’ decisions.
"This provides much needed clarity and will remove the regulatory uncertainty that surrounds the current test, providing great reassurance to charities campaigning within the requirements of charity law."