Faith-based organizations typically qualify for tax-exempt status under IRS rules. This is one place where religion and government meet and where the former benefits from a tax concession granted only to nonprofits.
Churches, synagogues and mosques are different from other nonprofits, even other faith-based organizations. They don't have to apply for nonprofit status; they get it automatically. They don't have to report income to the IRS. And they are often exempt from employment and anti-discrimination laws.
In exchange, religious groups must promise the government not to endorse (or appear to endorse) a particular candidate running for public office.
Is this a fair bargain? Does it restrict freedom of expression? Does it impose any obligations?
With the IRS' tax return filing deadline two days away, The Post and Courier asked a few community leaders for their thoughts on the subject.
I think I want to approach this question in three ways: constitutionally, theologically and then practically. All three of these areas bring me to the conclusion of no, churches should not pay taxes.
Constitutionally speaking, I have personal difficulty over the current myth of “the wall of separation of church and state.” However, if that is the vocabulary we are going to use, then the government cannot have a one-way wall which keeps the church out of government's affairs but seeks to use the church to finance its affairs.
The power to tax is ostensibly the power to control and regulate. To be candid, the power to tax is the power to destroy. As the old saying goes, “He who holds the gold makes the rules” (not biblical, but it makes the point). If government can tax the church, then in a very real way, it can direct the church's vision and direction. This is a direct violation of the First Amendment of government's noninvolvement in the activities of a church.
Theologically speaking, taxation implies authority and oversight. I believe God oversees His church, not man nor governments. To require monies from
any church or religious place of worship would, by direct implication, mean that the government somehow “stands over” that which even the Founding Fathers understood (through the vocabulary of the First Amendment) was outside the government's realm of authority.
Practically speaking, most churches (and there are more than 350,000 in America) are small (75 or less) and are not wealth-producing or profit-producing entities. Churches live on tight budgets and are staffed primarily by volunteers. While the mega-churches get most of the attention, they are the anomaly (less than 1 percent) and do not represent the vast volunteer churches that run on a shoestring.
Along with that, one must consider that every member of every church pays individual and business taxes, which could be construed as double taxation. It also would effectively shut down thousands of helpful programs that assist needy people who are not currently relying on government entitlements.
Bottom line: Taxing churches is not a good idea.
Dr. Kevin Baird, pastor Legacy Church, West Ashley
Small price While one may argue that separation of church and state would imply that a religious body is exempt from paying taxes, one must nevertheless take a step back and appreciate the value that the religious organization is receiving from the government.
Jewish history is wrought with examples of anti-Semitism and persecution,
which prevented Jews from freely practicing their religion. In a world of anarchy, religious institutions will crumble.
If paying taxes is the mechanism to support our government, which in turn allows us to safely observe our religion, free from persecution, I say it is a small price to pay.
Rabbi Ari Sytner Brith Sholom Beth Israel Synagogue, downtown
Democratic thing to do Faith-based organizations should have tax-exempt status.
The beauty of nonprofit tax-exempt status is that it promotes democracy and religious freedom simultaneously, while maintaining the separation of church and state. At its heart, nonprofit status balances our capitalistic society, providing a place where motive, not money, can be the purpose for an organization.
One of our core beliefs as Americans is that serving one's neighbor and society is the task of all, rather than simply the government. If the government were the sole caretaker, it would infringe on our religious freedoms by choosing what services to provide or deny.
Our government subsidizes the work of faith-based nonprofits in a most democratic way. It gives grass-roots society the vote on who receives the subsidy of tax exemption by how much society supports or does not support a cause. The more donated, the more tax exemption received.
In a world where often our attention is on government and money, it is a blessing that we can focus on democracy and motive. While maintaining a separation of church and state, tax exemption allows us to democratically express our motives through our belief and practices.
The Rev. Rich Robinson Epworth United Methodist Church, James Island
Nuevos Caminos Mission Right to choose
Government should not treat religious nonprofit organizations differently from secular nonprofits. Government should not favor one religion over another, or religion in general over nonreligion.
However, our tax policies do privilege religion over nonreligion in many ways. Here are just a few examples:
Religious organizations automatically receive tax-exempt status from the IRS without having to prove that they are doing charitable work, whereas secular nonprofits must prove they are worthy of such tax-exempt status.
Clergy are exempt from paying income tax on church-owned property they rent at reduced rates or live in free, whereas no such tax-exempt housing allowances are available for other types of nonprofit organizations.
Unlike secular organizations, religious organizations that receive federal funds (allegedly for secular causes) may discriminate in hiring on religious grounds. Cooking soup and giving it to the poor can be done equally well by “people of faith” or secular groups.
Religious liberty must include the right for taxpayers to choose whether or not to support religion and which to support. Forcing taxpayers to privilege and subsidize religions they don't believe in is akin to forcing them to put money in the collection plates of churches, synagogues or mosques.
Herb Silverman Secular Coalition for America
American way From a purely legal/Constitutional standpoint, such exemption was definitively deemed “kosher” (by liberal and conservative justices alike) in an overwhelming 7-1 decision by the United States Supreme Court (Walz v. Tax Commission of the City of New York, 1970).
The matter has been settled. So in the Jewish tradition of answering a question with a question, I ask: Why is this question being asked here at all? What is driving the discomfort of some with granting any special regard, deference or consideration to faith-based entities?
The separation of church and state precludes the government's endorsement or establishment of any one particular religion. It does not, however, diminish the special place that faith holds in the very foundation and implementation of our system of government.
The founders of this great nation were not hesitant to make the case for independence on the basis of being so entitled by “nature's God” and the fact that all men are “endowed by their Creator” with certain inalienable rights. Similar acknowledgements of the Almighty appear repeatedly in just about every essential implement of our civic process, including our currency, pledges, invocations, swearing-in ceremonies, etc.
We stand on the shoulders of giants. This republic, whose guiding principles are rooted in God-based, Judeo-Christian values, was not intended to be governed with freedom from religion, but freedom of religion. To expunge the special place faith holds in our national consciousness and principles is to belie that which makes the United States of America the most moral, dignified, compassionate and just system of government in the history of human civilization.
It is easy to take for granted the blessings we have; to assume that we can continue enjoying the fruit even as we uproot the trees. It does not work. Tear out the roots and the fruit will soon be lost, God forbid.
Faith-based organizations are right there in the communities with the people. These entities are often far better suited to help the poor, the hungry, the homeless, the troubled and the disillusioned than government. Extending special privilege and consideration to such organizations is not a departure from the American way; it is at the very core of it.
Rabbi Yossi Refson Chabad of Charleston and the Low Country
Free church, free state To be honest, the first response that comes to mind has little to do with institutional religion. My first impulse is to reflect on the paying of my taxes as a citizen. In an age of austerity, when many public programs (from schools to libraries to infrastructure) are being cut, I find myself more than willing to pay my share to support the common good. Like many citizens, I am concerned that the money we all chip in is spent wisely, but when I think of taxes I think of the original motto of the United States: E Pluribus Unum, “one from many parts.” We're all in this together. Pass the hat.
While I am happy to pay my taxes as a citizen, I also appreciate the American tradition of separation of church and state. A part of that tradition has included not-for-profit tax status for religious communities.
From a practical perspective, this tax status helps many smaller churches to make their budgets and employ staff. Yet I strongly believe that along with this privilege churches have an obligation to give back to the larger community through respectful dialogue, civic engagement and service to those in need.
I appreciate The Post and Courier's question. Perhaps this is a good time to reflect on how we understand a healthy relationship between a free church and a free state.
The Rev. Jeremy Rutledge, pastor
Circular Congregational Church, downtown
Reform, not taxes “Churches are a business, and should be taxed like all businesses” is a sentiment you can find on countless blogs. I don't think we should tax religious organizations, but I empathize with those who are calling for churches to forfeit their tax-exempt status. It is an understandable response emerging from a growing nonreligious public that has seen decades of scandals, abuses of power, and utter financial excesses from those who claim to be worshipping a humble and poor itinerant preacher.
Even non-Christians realize, perhaps better than some Christians, that contrasting the life and message of Jesus with the megachurch empires of “prosperity gospel” preachers and the aloof bureaucracy of the highly institutionalized church leaves the honest observer feeling like something is just profoundly wrong. These religious organizations can look uncomfortably like businesses.
But beneath the behemoth of the hierarchical church and the leviathan of “health and wealth” Protestant churches that grab the media spotlight, there are hundreds of thousands of religious organizations that bear little resemblance to a business.
They run the gamut from historic to contemporary, established to grass-roots, Catholic to charismatic. What they share in common is that they often do enormous good for their communities, operate in ways that reflect far more faith than financial prowess, and survive on what is often a shaky stream of sacrificial donations.
Let's create justice only where there is injustice. We are more than capable of passing reforms to prevent abuses of religious tax-exemptions without strangling the local centers of religious life that contribute to the vitality and spiritual diversity of the community.
Colin Kerr Director of Campus Ministry, The Journey Presbyterian Students Association