Sunday, 30 January 2011

End tax-exempt status for churches

Life was good for the priest, back in the old days. He would grant legitimacy to the throne, put the crown on the royal head, say a few things about the divine right of kings, blah blah blah, and in return the king protected the papacy and provided access to power.

Those days are gone, but churches still get a sweet deal. They're exempt from taxes, which means that all of us, even non-believers, are stuck with the tax bill for their water rates, property taxes, roads, car registration tax, and more -- to the tune of at least half a billion dollars a year in Australia alone.

But this might be changing in the USA, as cities start to tax churches for their fair share.
When a community needs to rebuild crumbling roads, should houses of worship pay fees for the number of times their congregants drive on them?

That's the question behind a recent suit filed by churches in the small city of Mission, Kan., who argue the city's new "transportation utility fee" is a tax they should not have to pay.

With cash-strapped states and cities facing a slew of tough choices, there's a growing debate nationwide about whether religious congregations should help foot the bill.
I don't know how successful this will be, but I find it incredibly encouraging that people are starting to have this discussion.
"It makes no sense to tax churches and to limit their ability to provide their services, and it does damage to the constitutional separation between church and state," argues Erik Stanley, senior legal counsel for the Alliance Defense Fund, which is representing Catholic and Baptist churches in the city of 10,000.
Ohh, now they care about separation of church and state.

Seems one American senator is highlighting the problem at the federal level.
“THE constitution does not require the government to exempt churches from federal income taxation or from filing tax and information returns.” The potential implications of this comment, in a report earlier this month by Senator Chuck Grassley of Iowa, are starting to dawn on a large chunk of America’s charitable sector, which has until now taken for granted that it is exempt from tax.

Currently, an estimated 1.8m “churches” are exempted from income tax—as they have been since America created its modern income tax system in 1894—and indeed from the many other reporting requirements imposed by the Inland Revenue Service on secular charities, which have to file IRS form 990 each year detailing their finances. The influential Mr Grassley, who has long championed greater transparency and accountability in the charitable sector, has become increasingly convinced that this privilege is being abused to the tune of many millions of dollars.
I look forward to a lot of squealing from the ecclesiastical sector. So churches do charity work? Fine. Have them disclose what percentage of their work is for charity, and treat that part of the business like any other charity. The rest of the business can pay taxes. Churches are money-making businesses, and they ought to be treated as such.


  1. i know you dont like ppl who bag scientology more than other religions, but, damn, this is gonna suck for scientology

  2. Australia is very different to America where church giving is tax exempt, which means Scientolory, or any Church org, has a much tougher time building an empire.

    "... all of us ... are stuck with the tax bill for their water rates ... roads"

    I know there are pensioner rebates from Sydney Water, but how can my local church get rate reductions? And roads? WTH?

    "Churches are money-making businesses"

    They shouldn't be, and most aren't, but what about the "core" activities of Sunday worship, youth groups, visiting the elderly and sick? Should they have some tax exception?


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