Christians who tried to demonstrate against the appropriations were prevented from doing so by Kurdish security forces in one instance in 2016.
Additionally, Yazidis have reported pressure that they be identified as ethnic Kurds, contrary to the opinions of some Yazidis that they are separate ethnically.
NGOs have also reported that, in the Sinjar region, there are "economic blockades" and "restrictions on freedom of movement and return, and the prevention of goods and supplies being distributed."
Other countries surrounding Kurdistan feature abuses of freedom of religion, USCIRF reports.
USCIRF rates countries on how much they respect religious freedom in a tier system. Tier 1 Countries of Particular Concern (CPC) are those with the worst situations for religious freedom, with "severe" abuses of freedom of religion that are "systematic, ongoing, and egregious."
The State Department has followed USCIRF's recommendations and has listed Iran as a CPC. USCIRF has also recommended that Syria be designated as a CPC.
Tier 2 countries represent the next level where the religious freedom situations are not as serious, but are still concerning. Iraq is a Tier 2 level country, according to USCIRF's latest recommendation.
"Until 2017, it was also recommended that Iraq be included in the list of CPCs, but improvements in the country have led to USCIRF revising its assessment," the commission explained. USCIRF has also listed Turkey as a Tier 2 country.
Yet despite its security for religious minorities that is comparatively better than surrounding areas, Kurdistan on its own "might well be considered a so-called 'tier 2' country, requiring close monitoring due to the nature and extent of violations of religious freedom engaged in or tolerated by its authorities," USCIRF stated.
This is concerning, the report said, because there is already a push for Kurdistan to be an independent country, and the pressure for such a state of affairs may only increase in the future.
"By strengthening institutions and encouraging reforms to promote and protect religious freedoms and minority rights now, (Kurdistan) and its population will ensure that these rights and freedoms are deeply ingrained in the makeup of any new nation and its social contract," USCIRF said.
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"On the other hand, allowing rights and freedoms to be eroded now risks setting a trend that will likely continue after independence."