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We would all win if churches - and atheism - were taxed

By Max Wallace - posted Friday, 18 July 2014

On 21 March 2014 the Managing Director of the Australian Christian Lobby, Lyle Shelton, posted ‘We would all lose if churches were taxed’ in On Line Opinion.

As the title from this response implies, the way Lyle framed this issue missed the point about the desirability of government taxing, not just the churches, but atheist and other alternatives to religion, as well.

In my book, The Purple Economy, published in December 2007, I made it clear that was my position. I also detailed my opposition to the non-taxation of atheism in On Line Opinion  on 12 November 2012.


On 8 August 2013 Robert Nola and I published this  Max Wallace & Robert Nola: Asset rich churches should pay fair tax ...

 in the New Zealand Herald. We recycled my argument that the exemption from taxation for religion is an inappropriate ancient privilege dating from the 1601 Statute of Charitable Uses.

It can be easily distinguished from the other four main ‘heads’ of charity: the relief of poverty, the advancement of education and other purposes beneficial to the community. We argued it should be a simple matter to amend charity and tax law by simply deleting ‘the advancement of religion’ as a head of charity to the benefit of all.

The privileges that alternatives to religion enjoy may be more complex to remove, requiring legislation that overrides the common law decisions that have brought non-religious organisations into the tax-exempt net.

The purpose of these kinds of reforms is twofold: firstly, to recover the substantial annual revenue that goes missing because of the religious exemptions especially, roughly calculated by Perkins & Gomez  to be annually $31B in gross terms. These are crude estimates because detailed information is not available.

In the US, associate professor Ryan Cragun and his associates were better able to calculate the annual loss to revenue at $71B US Loses Over $71 Billion in Religious Tax ... - Center for Inquiry


I believe the main reason the Australian figure is so high is that Australia funds religious schools while the US federal government does not.

What citizens believe is no business of government. When governments subsidise belief on the ancient justification that these beliefs are a public benefit, they are locking themselves into the worldview of the 1601 Statute where it was assumed Her Majesty’s (Elizabeth I’s) subjects were religious by definition. Government was then a theocracy with no separation of church and state. We now live in democracy, admittedly with no true constitutional separation, as discussed below, but we are at least aware of the principle.

So, there are two main objections to government subsidising belief (1) it is no business of truly secular government and (2) the substantial revenues that would flow back to government at federal, state and local government levels would be a significant benefit for governments in addressing all the expenditure commitments they have to all citizens, be they religious or secular.

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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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