The free tax ride for religious institutions in Australia is about 400 years past its use by date, argues Brian Morris.
In 1587, Dr John Bridges coined the phrase “A fool and his money are soon parted”. Just 14 years later Queen Elizabeth the First issued her 1601 Statute on Charities making “the advancement of religion” an act of ‘charity’, and free of all taxes. The church hierarchy were no fools – they and their accumulated church wealth would remain inseparable.
Australia inherited this 400-year-old statue at the time of colonization, and religion remains effectively tax-free – along with many quasi-religious activities which have no clearly defined charitable purpose. It’s an issue of increasing concern given the rising profile of churches in private education, private health, aged care, and a variety of commercial interests.
Churches demand their activities remain “outside the taxable economy” and this is the point of contention. Antiquated tax laws need to be revised – not necessarily overturned but modified in synch with changing attitudes towards religion. Greece has already acted – in 2010 they revoked many tax concessions enjoyed by the Greek Orthodox Church.
The Centre for Public Christianity (CPX), in a recent SMH article, contrived to defend the somewhat archaic tax-free status for all religions. The arguments by CPX are at best disingenuous and at worst dishonest when they boldly claim, “Churches aren’t businesses and they still deserve a tax break“.
Clearly, genuine Australian charities need tax relief, but only 20 per cent of the 54,000 charities actually provide services for people who are disadvantaged. Do we still need to reward churches that merely “advance religion”?
Is it not time for government, the public and media to think seriously about religious organisations that don’t provide any authentic charitable services – those evidently operating as a business, or who only promote religion?
Does CPX truly advocate tax havens for the Church of Scientology, or a host of cults like Agape, and all the evangelical groups whose primary role is to make schoolchildren “disciples of Christ”? Does the Centre for Public Christianity itself – along with the Australian Christian Lobby, and all other religio-political lobbyists – believe they should be tax-exempt?
For CPX to equate these powerful organisations with scout groups, historical societies or art galleries – that serve a far broader community – is quite unjust and dishonest. Nor do they compare with the countless church businesses in food, commercial services, health, education, aged care, wineries, and all the other enterprises that operate virtually tax-free.
For whose benefit do all these religious publicists and promoters exist? Do they gain tax dispensation simply for recruitment, where congregations are in sharp decline? Only 8 per cent of Australians now attend church regularly.
But the crux of this whole taxation problem is accountability.
What are the churches of every denomination really worth, together with their quasi-religious ventures? What is the value of all their vast holdings in property, land, assets, investments, and collective incomes? And should some small part of their operations now contribute to the much wider community in some form of taxation?
We simply don’t know these precise figures, although estimates run into many billions. The truth is that religious organisations are not required to submit annual reports to the Australian Charities and Not-for-profits Commission (ACNC). Some churches may well pay selected state or local taxes but we don’t know! It’s time we did!
Public debate on the whole question of religious tax exemptions and changes to the Charities Act are long overdue. Four centuries on from the Statute of Elizabeth, citizens should know the wealth and income of all Australian churches, their affiliates, and the organisations promoting religion. The ‘religious industry’ needs to become fully accountable.
Certainly, a tax exemption for merely “advancing religion” is an anachronism in today’s secular society – and particularly when other countries have already moved to make churches more financially and socially liable. Most noticeably this happened in Scandinavia where each country is more than 80 per cent secular and the last vestige of their Lutheran churches are audited each year and pay all national taxes.
In Greece, the Greek Orthodox Church is now required to pay taxes. These include a tax on their substantial real estate; a 20 per cent tax on rents they receive from their real estate; a 3 per cent tax on leased lands; a meagre 0.5 per cent on donations bequests and inheritances; and the church now pays stamp duty fees on the sale of its properties.
Arguments from vested religious interests, to keep Australian churches tax-free, have become tiresome. Churches no longer have a vast rank and file, only a privileged hierarchy intent on defending the indefensible. There is inescapable logic why entrepreneurial religion – that which is not self-evidently charitable – should pay a fair tax. All churches must be required to report annually their total assets and full income from all sources.
From there, rational decisions can be made on the amount that churches must contribute by way of taxation. The Greek model may well be a good place to start.
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