Published on Tuesday, July 10, 2001 in the Cape Cod Times
Rendering Unto Caesar
by Sean Gonsalves
President Bush is sincere in his call for faith-based institutions to become more involved in dealing with America's social problems.
And some of the flak he's been getting for making the practical suggestion that tax dollars be used to support what in many instances are successful faith-based initiatives is unfair and downright cynical on the part of his critics.
Too many progressives and people on the Left misunderstand and under-appreciate the transformative power that a vibrant spiritual tradition can provide.
This isn't to say there ought not be a "wall of separation" between church and state. It's needed - if religious freedom is to be protected. That said, I do have an unoriginal idea that could possibly satisfy both sides of the spat.
Instead of giving tax dollars to religious institutions, why not revoke the tax-free status of every church, synagogue, mosque or temple that doesn't have a social ministry in place? In other words, only give the tax break to those religious institutions engaged in serving at-risk youth, the elderly, the poor, the sick or the imprisoned.
Edd Doerr, executive director of Americans for Religious Liberty and ACLU board member, has some interesting things to say about religious institutions and taxes.
"Should churches pay taxes? How do church tax exemptions square with the constitutional principle of separation of church and state?," he asks. Then he candidly acknowledges that these may be simple questions, but there are no simple answers.
In considering whether church property or income should be taxed, Doerr emphasizes that "we need to recognize the complexity of federal and state tax structures." Then he gives a brief review of some important and pertinent data that must be taken into account by anyone interested in the matter.
Extrapolating from data collected and calculated in the mid-1970s by researchers Martin Larson and Stanley Lowell (no significant analysis has been done since), Doerr conservatively estimates that religious institutions in America own more than $200 billion in property.
About half of that value is in buildings used for worship, while the remainder is in parochial schools, denominational colleges, hospitals, charities and retirement homes, he notes. Using the Larson-Lowell data, Doerr further extrapolates that church income from private sources exceeds $40 billion annually.
None of this includes the difficult-to-calculate millions of dollars that religious institutions get in the form of federal and state aid. Suffice it to say that tax revenues would be much higher if religious institutions didn't enjoy the free ride and subsidies made available under current and past tax laws.
What's most interesting about Doerr's analysis is his observation that "some states exempt parsonages from property taxes, while some place restrictions on such exemptions. Some states exempt all church-owned property from taxation, while others place acreage and use limits on the exemption.
"Some states exempt church businesses from income taxes, while others, such as Tennessee, tax church business income proportional to the share of business done in commercial trade," Doerr wrote in a recent article.
In 1970, the Supreme Court ruled in Walz vs. Tax Commission that church property tax exemptions do not violate the First Amendment. The court held that tax-exempt status for religious institutions does not amount to establishment and that applying property taxes to churches might well create more entanglement between religion and government than would tax exemptions.
"It is important to note that while the court ruled that church tax exemption is not unconstitutional, it did not rule that exemption is always mandated by the First Amendment," Doerr adds.
He then points out that in 1989 the Supreme Court allowed President Bush's home state of Texas to apply the state sales tax to Bible sales, while in January 1990 the Supreme Court justices ruled unanimously that the First Amendment did not protect Jimmy Swaggart's religious enterprise from California sales and use taxes on religious material and other goods sold in-state at rallies or by mail.
Doerr concludes: "No radical changes in tax-exemption policies are foreseeable, but there is no reason not to press for carefully thought out incremental tightening of tax policy."
With Bush's faith-based plan on the table, the time may be ripe to repeal the tax exemption for religious institutions without a social ministry, earmarking the additional tax revenue for education, health care or housing for what Jesus called "the least of these" among us.
Sean Gonsalves is a Cape Cod Times staff writer and syndicated columinist. He can be reached via email: firstname.lastname@example.org
Copyright © 2001 Cape Cod Times