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Non-Religious Tax Avoidance

By Max Wallace - posted Monday, 12 November 2012

At the Atheist Foundation of Australia (AFA) Convention in Melbourne on 14 April 2012 Geoffrey Robertson QC turned his mind to the tax-exempt status of religion. He joked that:

Atheist foundations could qualify for tax exemption by declaring their belief in Christopher Hitchens! Turn him into an L. Ron Hubbard figure to be worshipped through his sacred books!

It got a good laugh. It never occurred to Robertson, or the Convention audience, that the AFA, like all religions in Australia with a supernatural belief, might already be tax-exempt.


The fact is the AFA had applied to the Australian Tax Office (ATO) for tax-exempt status from 1997. The Australian Atheist of September 1999 reported that its application to the tax office as either a charitable 'religious or educational institution' had not been approved but that:

...based on the information provided, we confirm that the Atheist Foundation of Australia Inc does not qualify as a 'charitable institution for the advancement of either religion or education', a religious institution or a public educational institution. However, we do recognise for taxation purposes that your Association is principally a scientific institution for the 'study of the science of philosophy and the propagation of outcomes' for a public purpose.

The AFA's decision to apply for tax-exempt status began in 1996 when The Australian Atheist of December that year reported with some indignation that 50 per cent of the interest on a $5,000 deposit with a major bank had been lost as taxable income to the ATO. That began two years of negotiations with the ATO which finally led to the 12 July 1999 determination cited above.

The question I am posing here is whether the pursuit of tax-exempt status by non-religious organisations such as the AFA, humanists, rationalists et al is consistent with secularism. I argue it is not. It is neither here nor there that the tax-exempt status is achieved either as a charitable organisation or other not-for-profit organisation as the result is the same: taxpayer subsidy of non-religious belief or non-belief. I use the term 'non-belief' here to accommodate those atheists who believe their atheism is not a belief.

This move by the AFA to be recognised as either a 'charitable institution for the advancement of either religion or education' was bizarre to say the least. From its inception the AFA had of course been highly critical of religion. Its early newsletters consisted mainly of photocopied press clippings which illustrated the worst aspects of religion.

Just why the AFA in 1997 contemplated identifying itself for tax purposes as possibly a religious institution indicates a serious muddle-headedness. It seems the requirement to pay tax on its bank interest was more important than simple intellectual consistency i.e. it is contradictory to pose as the very thing you're against, especially when the loss involved is not all that serious and taxation itself, while irksome, is a public good.


It was also muddle-headed because not much later the AFA would re-publish Richard Lead's 1998 'Oasis of Privilege' from The Skeptic magazine where he detailed and excoriated the tax exemptions for religion. Also, in the June 1999 issue of The Australian Atheist Claude Voarino's article 'Is Atheism a Religion?' was published where he concluded:

…the philosophy and the aims of the Atheist Foundation of Australia, printed on the inside of the front cover of each issue of The Australian Atheist, are yet another clear indication that atheism is not a belief, a faith  or a religion. Therefore, we have to agree with the Australian Taxation Office that the AFA doesn't qualify as a tax-exemptible [sic] institution.

He concluded, correctly in my view, 'the same should definitely be the case for all religious organisations in this country and elsewhere!'But, by then, the AFA's application to the ATO to be recognised as either a charitable religious or educational institution had been transformed by the ATO into acceptance as a 'scientific institution' for the pursuit of 'the science of philosophy.'

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This article was originally published in Australian Humanist No. 108, Summer 2012.

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About the Author

Max Wallace is vice-president of the Rationalists Assn of NSW and a council member of the New Zealand Assn of Rationalists and Humanists.

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