5 reasons we should never tax churches, even if John Oliver is right

I love John Oliver. And his recent segment on the tax status of churches was brilliant and funny. That said, it’s not a justification to change how we exempt churches from taxation.

Oliver’s segment show just how easy it is to start a church in America. As I tell students: if you want to start your own religion with yourself as prophet or divine being, then you can do it. No questions asked.

In the parlance of economics, the result is as close to a free, unregulated market as you’ll find anywhere. Government doesn’t regulate the industry. It doesn’t pick favorites by providing subsidies to one church but not another. No one is taxed. Startups require no government approval. No civil rights laws affect hiring or services.Government does not audit churches. It does not keep a register of religious groups. There is no “U.S. Department of Religion” that subsidizes or regulates religion. Churches do not even file the same paperwork (Form 990’s) that other types of nonprofits submit as a means to provide transparency to the public.

If Walmart declared itself a church and held service in its stores, do you think they should be tax exempt? What if they called their revenue “donations” and their merchandise “blessed objects”?

The problem with tax exemption for religion is that it puts the government in the position to decide what a religion is and what it isn’t. This is a violation of the separation of church and state.

This issue came up with the Church of Scientology. The IRS would not grant them a religious status. The Church ended up strong-arming the IRS into granting them religious status.

Just exactly what is “the separation of church and state”? Where is it in any of our founding documents? Where does it say we have to obey it? What Supreme Court cases were decided by applying it?

Let me help clear up some errors in your thinking. If Walmart were to claim to be a religious organization, they would still be subject to all of the same taxes they are now for their business income. There is a provision of the tax code for just this thing called Unrelated Business Income Tax (UBIT). Any nonprofit or church that runs a business or activity that is not directly related to their worship or their nonprofit mission, is subject to this tax.

My local parish has a small gift shop attached to it, and must pay taxes on any profits from this gift shop (there aren’t much, if any). A local nonprofit kid’s center near me provides meals for other nonprofit daycares around them. They must account for this income and expenses and pay taxes on the income related to it.

So your concerns are completely unwarranted.

The problem with tax exemption for religion is that it puts the government in the position to decide what a religion is and what it isn’t. This is a violation of the separation of church and state.

Maybe we should just do away with the insipid income tax before we start going after churches for greedy bureaucrats to spend.

And there is no separation of church and state in our government.

This issue came up with the Church of Scientology. The IRS would not grant them a religious status. The Church ended up strong-arming the IRS into granting them religious status.

Yes, they fought for it. I think they are a weird cult, but what about them makes them not a religion?

And the article only touches on another issue. Religious minorities would be the ones most affected by taxation. It would be a very convenient way for the majority in a locality to raise taxes on all churches substantially to force out the minority church they don’t like. Once the church is forced out, they can just lower the tax back to nothing.

The power to tax is the power to destroy.

I would love it if Walmart only excepted donations for their merchandise because the pricing for most religious goods is simply the recommended donation. Therefor, you could get that huge plasma TV for a huge discount, or even free if your hard up for cash. They wouldn’t declare themselves a church for very long, especially when the homeless start showing up for assistance.

Woah…easy there zz! Deep breaths, deep breaths.

Now, you say the Church of Walmart should be taxed because it operates as a traditional business with products and services.

The Church of Scientology, however, also operates as a standard business in many respects. They sell both products and services yet pay no taxes because they consider them religiously oriented.

And yes, there is a separation of church and state in our government. The establishment clause of the Constitution describes a freedom of religion which can only exist if there is also freedom from religion.

No, there isn’t. In simple terms it says the government will not establish an official religion. How could you separate church and state, anyway? A person is not two persons, one when he’s inside a church and a different one outside, because his beliefs will affect his behavior.

The establishment clause of the Constitution describes a freedom of religion which can only exist if there is also freedom from religion.

This is a non-sequitur. How did we have freedom of religion for over 200 years before Hillary thought up the phrase, “freedom to worship” and you thought up “freedom from religion”? IOW, prove it.

Saying that you will not have an official religion means that people can worship (or not worship) whatever they want as the see fit. They can do this to the extent that it does not interfere with other’s rights.

You are correct insaying that people who work in or interact with government may be influenced by their particular religious worldview but the government itself cannot make laws that include explicit religious content.

Not sure what you’re trying to say here. Who is Hillary?

I’m not upset or even excited. Just clearing up your errors.

The Church of Scientology, however, also operates as a standard business in many respects. They sell both products and services yet pay no taxes because they consider them religiously oriented.

They pay taxes on any profits from unrelated business, just as any other church or nonprofit does.

And yes, there is a separation of church and state in our government. The establishment clause of the Constitution describes a freedom of religion which can only exist if there is also freedom from religion.

No, there is not a separation of church and state in our government, no matter how many times you assert it. Freedom of religion can certainly exist and needs no freedom from religion. That’s pure silliness. Freedom from religion is simply disallowing anyone with a religious background and only allowing the religion of secularism to thrive.

In fact, the prohibition in our Constitution only applies to the federal government, specifically Congress. Congress is prohibited, but churches are not. This atheistic reinterpretation of the Constitution is hogwash.

Well I tend to agree with you, but with some caveats. I see no problem with the government deciding what is or what isn’t a religion. And it should certainly have more stringent guidelines for doing so. However, if you can’t define what is or isn’t a religion, then how can you possibly enforce separation of Church and State?

And as for those in the other posts who think you can’t have separation of Church and State, I suggest reading the Wiki or reading up on the Founding Fathers. Many of the most prominent ones were open Deists, particularly Benjamin Franklin. Here is probably one of the most important letters written by Thomas Jefferson:

To Messrs. Nehemiah Dodge and Others
A Committee of the Danbury Baptist Association in the State of Connecticut

January 1, 1802

Gentlemen,

The affectionate sentiments of esteem and approbation which you are so good as to express towards me, on behalf of the Danbury Baptist Association, give me the highest satisfaction. My duties dictate a faithful and zealous pursuit of the interests of my constituents, and in proportion as they are persuaded of my fidelity to those duties, the discharge of them becomes more and more pleasing.

Believing with you that religion is a matter which lies solely between man and his God, that he owes account to none other for his faith or his worship, that the legislative powers of government reach actions only, and not opinions, I contemplate with sovereign reverence that act of the whole American people which declared that their legislature should “make no law respecting an establishment of religion, or prohibiting the free exercise thereof,” thus building a wall of separation between church and State. Adhering to this expression of the supreme will of the nation in behalf of the rights of conscience, I shall see with sincere satisfaction the progress of those sentiments which tend to restore to man all his natural rights, convinced he has no natural right in opposition to his social duties.

I reciprocate your kind prayers for the protection and blessing of the common Father and Creator of man, and tender you for yourselves and your religious association, assurances of my high respect and esteem.

Thomas Jefferson
President of the United States

Bear in mind that the prohibition against churches’ directly meddling in politics is purchased at the cost of tax exemptions for religious/charitable organizations. When religious organizations do carry out purely political functions, the IRS can remove, and has removed, those tax exemptions. If the government were to remove those exemptions across the board and start taxing churches and charitable organizations, all limitations of political activity by those organizations would also be removed.

This statement is overly broad and thus incorrect.

The prohibition against participating or intervening in a political campaign applies only to elections for public office, and does not apply to attempts to influence legislation. (Churches and other §501©(3) exempt organizations may engage in such attempts to influence legislation as an insubstantial part of their activities.) …

THE CHURCH AND POLITICS: A REVIEW OF THE IRS GUIDELINES FOR CHURCHES
Charles M. Watkins, Esq.
Webster, Chamberlain, & Bean
Washington, D.C.
priestsforlife.org/elections/symposiumwatkins.htm

“Insubstantial” has generally been interpreted to mean less than 5%.

You are correct on the fine details. I, perhaps, should have been clearer that removing the tax exemptions from churches and charitable organizations would open the doors to their fullblown participation in politics.

Fine details make all the difference, and unfortunately, most know only what they read on bumper stickers, which are too small to carry fine details. One Sunday after the Masses, the Knights of Columbus was conducting a signature drive for a ballot initiative defining marriage as one man and one woman. One parishioner took exception and started a rant over his wanting the church taxed because it was “mixing religion and politics.” The poor Knight was shocked into silence because he had no explanation. I piped up to help him out, but because the ranter had no counter argument and I didn’t have the referenced opinion in my hot hands, he ended up calling me a liar. Not wanting to create a scene, I let it go, but I couldn’t help wondering why he objected or why he didn’t go join the Church of the ACLU instead. :shrug:

I ran into this thread, late and by accident and decided to add my thoughts.

I don’t think anyone is speaking of taxing a Church, which is a non-profit, just like millions of other non-profits, (charitable and uncharitable). What is truthfully being discussed is taxing me and you.

Churches are non-profits so there would be no profits to tax. Walmart, (or The Holy Church of Walmart) is a for profit corporation and would be taxed. If you think the Church has a profit, you do not know what a profit is,

What is truly being discussed is ending the tax deductibility of our charitable donations to Churches. That is a tax on those that make those donations, me and you.

You have forgotten about the possibility of taxing churches on the property that they own. Can you imagine what the property taxes would be on something like, say, St. Patrick’s Cathedral?

That is a state by state situation and wouldn’t have the IRS involved.

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