Defence of religious tax free status flawed

The fact that Ms Moore felt the need to defend these privileges is a measure of the growing concern many have for the non-taxation of 'the advancement of religion.' The problem the churches have is that this issue is now out in the open. Sooner or later there will be consequences. In fact, in Greece there already has been.

On 23 April 2010 the financially besieged government of Greece repealed some of the legislation allowing the Greek Orthodox Church to avoid taxes. These included

• A tax on their substantial real estate (being, like the Catholic Church in Australia, the largest land holder)
• A 20 per cent rate of tax on rents they receive from their real estate
• A 3 per cent tax on revenues from edifices and leased lands
• An advance payment of tax on their future likely incomes
• A trivial .5 of one per cent on inheritances and donations
• Some stamp duty fees on property sales

Pity Ms Moore forgot to mention this. She also forgot to mention the Senate enquiry of 2010 where Australian Tax Office officials were quizzed by two Senators on these matters. Here is the Hansard text of part of that enquiry:

Senator Xenophon: ... what quantum, what number of religions would you say are out there whereby, unless they become visible to you from some of their activity, you would not know they existed as such?

Mr Hardy (ATO): [religious organisations] ... do not have to lodge an income tax return. If they have no reason to have a dealing with the tax office in any other capacity then they have no dealing with the tax office.

Senator Xenophon: Do they advise you of their self-assessment [that they are not taxable]?

Mr Hardy (ATO): No. Self-assessment is that. They self-assess.

Senator: Xenophon: In other words, they are left alone. They have self-assessed and you do not have any reason to monitor them whatsoever.

Mr Hardy (ATO): No. The legislation does not provide for that. They are potentially invisible to us as a taxation entity.

There it is in black and white. The ATO has no idea how many religions are self-assessing or indeed how many there are. Every small religion, sect or cult is potentially a license to print money via tax-exemptions on their incomes. As icing on the cake, they alone are exempted from reporting their wealth to the Australian Charities and Not-for-profits Commission.

I conclude that the whole modus operandi of religions is to privatise profits through their tax exemptions and socialise costs.

A saddening illustration of the latter is the federal government's decision to make compensation for the sexual and other abuses of children in church and other organisations voluntary. This flies in the face of recommendation 35(a) of the Royal Commission that 'The institution in which the abuse is alleged or accepted to have occurred should fund the cost of redress.'

One can imagine the amount of lobbying that went on inside the parliament to achieve that financial outcome for the churches. But Ms Moore's take on this, in tax terms, is that the tax-exempt status of religious institutions should not be withdrawn if they have been found to have committed crimes against children: 'The tax code, though, isn't meant as an instrument for punishment.'

That is Ms Moore's opinion. I would have thought that is a matter for parliament to decide, should it ever care to consider it.