Give to Caesar What is Due Caesar, But Enact Laws to Limit What is Due Caesar
In the course of another conversation, I made the following comment:


On a related topic, I would fully support the taxation of churches. This would get rid of people who claim to be churches solely for the tax benefits. And there's no First Amendment "commandment" (heh) that churches be exempt from taxes; if there were, then the taxation of newspapers here in California would also be illegal. But this is a whole 'nother story...


Here is some additional reading on the matter of why churches are tax exempt, and whether they should be tax exempt:


[Austin Cline, in about.com's atheism/agnosticism section]

Tax exemptions may not be the most common issue facing courts in arguments over the separation of church and state, it is one of the most fundamental. Initially it appears to be a form of government support for religions and religious activities; on the other hand, the power to tax is the power to restrict or destroy, so is exempting religions from taxation a means of ensuring their independence?

Religious exemptions from taxation is no trivial matter. It is estimated that churches and other religious bodies may own anywhere between twenty and twenty-five percent of all of the land in the United States....

When all tax exemptions are taken into account, it is estimated that the average family may pay up to $1,000 in extra taxes every year to make up for the lost revenue not received from churches and religious groups. This includes sales taxes, inheritance taxes, income taxes, personal taxes, and ad valorem taxes.

It is thus arguable that all of this money represents an indirect contribution to all of those religious organizations. Because taxes which would go to pay for their share of maintaining society are made up for by the rest of us, they are free to use that money in other ways, for example promulgating their message to a wider audience. They certainly have a right to spread their ideas wherever they wish, but do they also have a right to public assistance in doing so?...

Tax exemptions for religious groups have existed throughout American history and are a legacy of our European heritage. At the same time, those tax exemptions have never been total or automatic. For example, some states have broad tax exemptions for parsonages while others have narrow restrictions on such exemptions. Some states have exempted Bibles from sales taxes while others have not. Some states have exempted church businesses from state corporate taxes while other have not. Private donations to churches have also had varying degrees of tax exemptions, while direct payments to churches for goods or services are rarely exempt from taxes.

Over the years both the courts and various legislative bodies have limited the ability of religions to benefit from tax exemptions. There are appear to be two possible means for this: either by generally eliminating tax exemptions for all charitable and non-profit groups, or by eliminating churches from the classification of charities.

Eliminating tax exemptions for charities generally would provide a great deal more money for governments, which is part of the argument for eliminating tax exemptions for religion. However, it is unlikely that there would be much broad public support for such a radical change in the tax code. Tax exemptions for charitable organizations have a long history, and for the most part, people tend to have a favorable impression of them.

The latter option, re-conceiving the idea of charities such that churches and religions would no longer be automatically included, would probably encounter just as much resistance. Currently, churches receive an automatic charitable tax exemption which is not available to other groups — an unfortunate preference. Should churches actually have to demonstrate that they are doing charitable work that entitles them to tax exemptions on their own merits, it is unlikely that they would receive the same extensive benefits as they currently do.




[Another Austin Cline article]

By not taxing churches, the government is prevented from directly interfering with how those churches operate. By the same token, those churches are also prevented from directly interfering with how the government operates in that they cannot endorse any political candidates, they cannot campaign on behalf of any candidates, and they cannot attack any political candidate such that the effectively endorse that person’s opponent.

What this means is that charitable and religious organizations which receive a 501(c)(3) tax exemption have a clear and simple choice to make: they can engage in religious activities and retain their exemption, or they can engage in political activity and lose it, but they cannot engage in political activity and retain their exemption.

What sorts of things are churches and other religious organizations allowed to do? They can invite political candidates to speak so long as they don’t explicitly endorse them. They can speak out about a wide variety of political and moral issues, including very controversial matters like abortion and euthanasia, war and peace, poverty and civil rights....

What does matter, however, is that such comments are limited to the issues and do not stray towards where candidates and politicians stand on those issues.

It’s fine to speak out against abortion, but not to attack a candidate who supports abortion rights or to tell a congregation to urge a representative to vote for a particular bill which would outlaw abortion. It’s fine to speak out against war, but not to endorse a candidate who is also opposed to war....

It is important to keep in mind that tax exemptions are a matter of “legislative grace,” which means that no one is necessarily entitled to tax exemptions and that they are not protected by the Constitution. If a government doesn’t want to allow tax exemptions, it doesn’t have to. It is up to taxpayers to establish that they are entitled to get any exemptions which the government allows: if they fail to meet that burden, the exemptions can be denied.




[Kansas City Star]

[A]ccording to the office of Texas Comptroller Carole Keeton Strayhorn, a Texas Unitarian church isn't really a religious organization - at least for tax purposes. Its reasoning: The organization "does not have one system of belief."...

Strayhorn's ruling clearly infringes upon religious liberties, said Dan Althoff, board president for the Denison, Texas, congregation....




[Factnet]

After repeatedly and justifiably denying Scientology's tax-exempt status, the IRS suddenly reversed its position in 1993 with the secret settlement granting Scientology religious status and canceling most of the organization's huge tax debt. The mysterious and shocking reversal for the U.S. tax agency came after 25 years of steadfastly refusing to provide Scientology with the tax exemption given to bona fide churches. Many believe that the scope of what was given away by the IRS to the multi-billion dollar Scientology organization, in financial benefit and other special considerations, is far beyond anything that has been given to any other religious group, corporation, or normal taxpayer.

As outrageously unfair as this secret deal appears, the means by which Scientology obtained it may be even worse -- from filing 2,200 lawsuits against the IRS, to sending private investigators to pry into the personal lives of IRS employees, to hiring an IRS-insider, to filing an application experts say is riddled with fraud. An IRS staff member who claims to have worked on the case called the secret deal a sell-out by higher management. Speaking on the condition of anonymity, the individual said that agents working on the case had endured frightening calls to their homes and disappearing pets, and that Scientology should have never been given what was given.




[localsov.com]

The American government has succeeded in marginalizing churches to a large degree. Feeding the hungry, sheltering the homeless, running schools, hospitals and orphanages, which once were the domain of churches have all been increasingly taken over by government. In many places where churches still do these things, they receive some money from the government in exchange for removing all religious content from homeless shelters, daycare facilities and other social programs. What is worse, churches have even compromised their basic beliefs under threat of losing tax exempt status.

It has been the churches themselves which have allowed this control by not fighting for the independence as our forefathers once did. One glimmer of hope, however, is a small but growing number of churches which are refusing to bend knee to Washington, refusing even to apply for tax exempt status or even to incorporate under secular laws.

Dr. Greg Dixon, Pastor Emeritus of Indianapolis Baptist Temple, is founder and head of the American Coalition of Unregistered Churches (ACUC). Dixon maintains steadfastly that the government has no authority to tax or regulate "the Lord's Church." He says that applying for corporate status or for tax exempt status would amount to acknowledging some level of control by the secular government. Dixon says, moreover, that "Tax exemption is a privilege, the Lord's Church is tax excluded." In other words, it is not up to the government to decide whether or not to tax the Church, because the Church as a divine institution is simply above taxation.

Another pastor in ACUC, Dr. Robert McCurry of Heritage Baptist Church in Sharpsburg, Georgia says that, "The power to tax is the power to control, and it is all about control." McCurry says that if churches allow the government to tax them then they have in effect given up control of their church....




[hushmoney.org]

The Framers of America's Founding Documents relied heavily upon the writings of the French political philosopher, Baron de Montesquieu. Typical of Montesquieu's brilliant insight, he once wrote that:

“A more certain way to attack religion is by favor, by the comforts of life, by the hope of wealth; not by what reminds one of it, but by what makes one forget it; not by what makes one indignant, but by what makes men lukewarm, when other passions act on our souls, and those which religion inspires are silent. In the matter of changing religion, State favors are stronger than penalties.”
The Spirit of the Laws, Baron de Montesquieu (1748)....




[LifeSite News]

Churches in Canada are, as they in most every part of the world, granted tax-exempt status and able to give charitable receipts for contributions. However CRA [Canada Revenue Agency] holds the power to strip all charities, churches included, of that most valuable status. Policies set by regulation and the courts determine what constitutes permissible charitable activity and prohibited activities. Final determinations on matters are made by the charities directorate – a panel of twelve ‘experts’ in charity law and the CRA policy governing the matter.

The CRA in its policy on the matter...states that activities that are prohibited for charities, those which will cause them to have their status revoked, are “partisan political activity.” However “partisan political activities” are not merely telling congregants to vote for a particular party or candidate. The policy states, “A partisan political activity is one that involves direct or indirect support of, or opposition to, any political party or candidate for public office.” That “indirect” support is a matter of interpretation.




[biblequestions.org]

Frankly, many religions today do not have a spiritual mission. Their interests are not those of the early church and the Lord’s church today, but big business. Unlike the early church Jesus established, they are into real estate, the social gospel, and making money. Their ministers are more corporate managers than preachers. Many of the tax breaks for religion are being shamefully abused and exploited. In some cases, businesses and companies cannot compete with some churches, which are also businesses, because of the tax breaks for these so-called churches. Just about every financial pursuit is presently seen characterizing the denominational world. Beloved, it is an undeniable fact that much of organized religion today is secular in nature and activity.

Should churches pay taxes? I am not sure how to answer this question. Wise government recognizes and appreciates the influence of real religion - morally, sociologically, and even economically. Should government assume the role of determining which religion should be tax exempt (a religion or business)? I am afraid this would result in more problems than cures.



But we'll end with this series of comments from a blog called Gutless Pacifist:


I personally wonder if churches should drop their non-profit status. Then they can say whatever they please about whoever, as long as it isn't slander. Of course, then our Sunday contributions wouldn't be tax-deductable, would they? Thus, it probably will never happen.
It's an interesting question. Which is more conducive to freedom of religion? For the church to be free from having to pay taxes to the state, or for the church to be free of having its activities monitored in order to maintain its tax-free status?

I would vote for churches paying taxes, and then being free to say and do whatever they want. My dad is a Pastor, and he feels the same way.
What I know is most exempt organizations may not allow themselves to become involved in any substantial political activities. Thus, an exempt organization normally may not (with certain exceptions) devote more than an insubstantial part of its activities to attempting to influence legislation by propaganda or otherwise ("lobbying"). Nor may it directly or indirectly participate or intervene in any political campaign for or against any candidate for public office. Prohibited activities include the publishing or distribution of statements made in connection with a campaign.
Not sure if this is true or heresay, but my mom mentioned that there was a for-profit church called "the rock" in gainesville, ga. Pastors get a % of the offering each week rather than a salary. better make sure that you preach after the offering...

Comments

gg said…
This is an interesting debate. To add another angle to this issue, you must have also heard of all the churches that indirectly or directly endorsed a candidate in this last election, defying the laws regarding this issue. As far as I have heard, none of these churches have faced any penalty for doing this.

I am not religious, I would at the very least expect Churches to follow the rules that let them stay tax-exempt. If they don't want to abide by these rules, they should certainly lose their tax exemptions. After that, the matter is up for debate.
Ontario Emperor said…
It's interesting to note that the CRA is more restrictive than the IRS regarding what tax-exempt bodies can do. As LifeSite notes, the definition of "indirect" is a matter of interpretation.
John Gillmartin said…
Interesting, thanks for the heads up!

HE ALONE IS WORTHY

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