cover of Culture Wars by Marie Castle(Excerpted from Chapter 7 of Culture Wars: The Threat to Your Family and Your Freedom, by Marie Alena Castle)


How equitable are religious tax exemptions? Many claim they are justified because of religion’s supposed beneficent moral influence—but families are not tax exempt, and they are the basic source of moral guidance. One of the original reasons for the religious tax exemption was that churches offered a support system for dealing with economic hardships. But it was overwhelmingly a system in which churches helped only their own members—and sparingly at that. For those who did not get their help, the dreaded alternative was “over the hill to the poor farm.” Now we have government programs such as Social Security, Medicare, Medicaid, unemployment compensation, and welfare assistance that are far more effective than religious charities in alleviating—however inadequately—the suffering of the poor.

Today, churches do little more than administer some of the smaller government assistance programs, for which they get paid—and get the credit, as they’re beneficiaries of the perception that the churches fund the programs. Their non-government-funded charitable activities are paid for mainly by secular sources, such as foundation grants and the United Way. Very little comes from church funds.

Would paying property taxes—or any taxes—be a significant hardship for churches? Very likely not, since many nonprofits lease their facilities, and so they do pay property taxes indirectly as part of the rental price, with no apparent financial distress because of this. Why would paying taxes be any worse for churches than for homeowners? Homeowners pay property taxes, and ordinary people pay income taxes, sales taxes, and taxes on interest, dividends, and capital gains, while churches pay no such taxes. Most corporations pay taxes on money or property bequeathed to them, while churches don’t. Businesses pay income and property taxes on nursing homes, publishing houses, and other enterprises, while churches that have similar income-generating assets are tax exempt, giving them an unfair competitive advantage. In bankruptcy proceedings in Minnesota, money tithed to churches is exempt from being allocated to satisfy creditors—one more way churches benefit unfairly at the ordinary citizen’s expense.

The tax exemptions that encourage all this have no secular justification. As well as being a burden on taxpayers, they have encouraged the proliferation of religious, charitable, and educational nonprofits, some worthy, many questionable. We have churches that seem focused almost entirely on providing private jets and mansions for their preachers—often in communities where the public schools are deteriorating for lack of sufficient funding. We have nonprofit charities that seem interested primarily in socializing. (Fraternal organizations with membership bars and dance halls come to mind.) We have educational nonprofits whose purpose appears to be to convince the public to think as they do, and to use their financial resources to affect election outcomes. Why exempt any of them, even those that provide worthwhile services? If they can buy and maintain property, pay their utility bills, and hire high-salaried CEOs, they can pay taxes like any other business.

What would be the result if all nonprofit organizations, both religious and secular, were treated like any other business for income tax purposes? Taxes would be based on ability to pay, so small organizations would not suffer major financial hardship, while large ones would easily afford the extra expense. As with any business, a nonprofit would succeed or fail based on its ability to attract supporters. And those supporters would be in a better position to contribute to the religious or secular nonprofit of their choice, because their property tax burden would be eased by virtue of it being shared equitably.

It could be argued that there should be exceptions for nonprofits whose primary purpose is to provide a full-time social service under contract with the government. However, many for-profit companies also provide goods or services to the government under contract, often as their primary activity. Such a contractual arrangement does not exempt them from taxes; neither should it exempt nonprofit contractors.

Would taxing religious institutions violate the religious freedom clause of the First Amendment by involving government in church affairs? No more than making newspapers pay income and property taxes violates freedom of the press, and no more than making a privately owned meeting hall pay property tax violates freedom of assembly.
One of the tradeoffs for being tax exempt is that religious and secular nonprofits are (in theory) not allowed to take political positions or endorse candidates, although they can discuss issues. Would that change if the tax exemptions were removed? Of course. But would that be significantly different from what is already going on? Does anyone who pays any attention to politics not know where the liberal and conservative churches, and the liberal and conservative secular nonprofits, stand on hot-button “moral values” issues such as abortion rights, gay rights, stem cell research, and teaching evolution in public schools? When nonprofits “discuss issues,” don’t they always make it quite clear how they want their supporters to vote?

At election time, don’t activities such as the Catholic Church in Minneapolis and St. Paul sending out thousands of pre-election DVDs opposing same-sex marriage tell voters something? Don’t the Protestant fundamentalists’ voters’ guides distributed to “moral values” voters tell the recipients something (and make it clear which candidates support the religious right social agenda)? Don’t pro-choice rallies organized by Planned Parenthood also tell voters something? It would be better to treat all nonprofits like businesses, tax them accordingly, and let them engage in politics openly rather than carrying on this “non-political” charade.

If religion-based laws were declared unconstitutional as Establishment Clause violations—which they clearly are—and churches were forced to pay their fair share of taxes, there would be no more point in pre-election voters’ guides, candidate “litmus tests,” and “single issue” voting than there would be in campaigns to reinstate slavery or deny women the right to vote. Until that happens, there will be no end to our culture war.



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