Karen Spears Zacharias wrote a piece at Patheos called Time to Tax America’s Churches. She looks at Ed Young, Jr. as the archetype of a new breed of CEOs, people who are leading vast and wealthy churches that function as corporations. She has some harsh words for these “celebrity” and “rock star” megachurch pastors, and she concludes her post with these statements:
We are facing hard economic times. A lot of much-needed revenue could be generated by taxing the Church.
If we are really interested in living out a life of faith, instead of just preaching about it, isn’t it about time the Church picked up its cross and carried it instead of pushing the tax burden off on everyone else?
I encourage you to read the article, but I have several responses.
1) Church employees are taxed like everyone else, with the exception of two benefits for ministers–a tax free housing allowance and the option to withdraw from social security. But if you claim the housing allowance, you better opt out of social security, otherwise that portion of your income will be considered self-employment, and you’ll have to pay both sides of the social security and medicare taxes. Other than these benefits, church employees pay the same tax as everyone else.
2) There is no distinction, in the state of Ohio at least, between a church and any other nonprofit organization. If the government were to implement income taxation on churches, it must also tax every nonprofit organization, otherwise it would likely face a lawsuit of religious discrimination.
3) It may be flat out illegal to tax churches and nonprofits because the income they generate is not recompense for goods or services, but is rather given of the free will of the givers. In other words, despite Zacharias’s depiction of megachurches as corporations, there is no commercial transaction taking place.
4) We live in a society where we constantly let one person ruin it for everyone. One person bends the rules and suddenly the masses have to bear the consequences. Freedom is impinged every time some idiot decides to do something stupid because we immediately run to the government to fix our problems and keep us safe. Let’s not do that with churches and nonprofits. Their work, which cannot be duplicated by any government, would be crippled by taxation. Sure, Ed Young would get his comeuppance, but thousands of churches and nonprofits would be forced to close their doors.
5) Charitable giving pales in comparison to consumer spending. The benefit from taxing churches and nonprofits would likely not even cover the cost of government services required to fill in the gaps of those now defunct organizations. It would be the law of diminishing returns proven true on a grand scale of social deconstruction.
6) Finally, a commenter on Zachrias’s post says it best when talking about the purpose of the church and the love of Christ:
Government can never embrace such love, will never live out such reality, can never love the enemy without regard to self, will never embrace the street person rather than the CEO, won’t ever hold up to be emulated the one who is most despised by society, and is not ever going to reject power for meekness, vengeance for grace, and violent action for forgiveness. Government, and indeed our American society itself, will always look at such claims as either nonsense, sheer naivety or both. And yet, Jesus does exactly these things, over and over, and calls us to do the same.
So, where I constantly struggle with my own collusion with and participation in denominational systems that too often look contrary to gospel relationship and being, I do believe that ultimately only the church has any possibility of congruence with life in Christ and, at its best, must be a counter to the state’s systems of power, privilege, and possession.
The Church and the Government–whether it’s Rome, Nazi Germany, or the USA–are not after the same thing. The Church, at its best, is a woman with warm embrace, comforting those who mourn, feeding those who hunger, and seeking first the kingdom of God. The Government, at its best, is a bureaucratic system of cold and distant departments, assigning numbers instead of names, rubber-stamping applications, and seeking first the security of the State.
So, I say, don’t tax the churches and nonprofits. Don’t let a few abusers ruin a system that works. The Government has more than enough money. Maybe we should begin our audits with them, and then we can move out to the churches and nonprofits.