False. The Government can absolutely declare domestic groups as terrorist groups. The Trump administration did this to white nationalist groups as well. The first administration in history to do so.
TRUMP JUST TRIED TO DECLARE "ANTIFA" AS A TERRORIST ORGANIZATION BUT THERE ARE 2 PROBLEMS. 1- BY LAW, THE GOVERNMENT CANNOT DECLARE ANY DOMESTIC GROUP AS TERRORIST AND 2- ANTIFA ISN'T EVEN AN ORGANIZATION OF ANY KIND.