Whenever I hear the word “taxes,” I immediately tune out of the conversation because it’s usually followed by either A) bad news or B) an old person going on a libertarian rampage. But last Friday, Sen. Ernie Chambers introduced a piece of tax legislation that didn’t trigger my gag reflex. The bill, known in the Unicameral as LB675, would deny property tax exemptions to religious organizations like churches, temples, synagogues and mosques. After an extended research expedition into the exciting world of taxes, I realized that the bill is not only politically just but also makes good economic sense.
We can start with the practical reasons to support the bill. Property taxes are paid directly to local governments, so requiring churches to pay these taxes will generate more revenue for these bodies. Even cities without a lot of religious structures could benefit from the legislation. Many local governments require additional funding from the state in order to stay afloat. More income for some cities could relieve their need for state assistance, freeing up those funds for other projects around the state. It’s difficult to figure out exactly how much money we’re talking about. Each religious property has a different value, meaning that there’s no quick way to get an answer. According to Chambers in his defense of the bill, there are close to 3,000 church properties in Nebraska, which could represent a meaningful increase in funds.
Moreover, eliminating the religious property tax exemption removes the problem of people claiming fraudulent exemptions. A person can become an ordained minister by just paying a fee online and printing off a certificate. For example, the website for the Universal Life Church Monastery only requires a full legal name and a valid email address for someone to become an ordained minister. Because the government can’t determine what counts as a legitimate religion, people with these certificates can then use them to apply for religious tax exemptions on property and income. Though the IRS has taken steps to avoid these abuses, the possibility for fraud still exists.
Churches, not just individuals, have the ability to abuse this policy by claiming exemptions on properties not used for religious purposes. Last year, for example, a Tennessee appeals court denied a 2,000-member church its property tax exemption on a building that included a fitness center, gym, bookstore, cafe and indoor playground in addition to its worship space. This case presents an interesting gray area. While the building did have a religious component, something about attaching things like a gym and a bookstore violates our intuitions about why churches should have a religious exemption. I think this presents a significant problem that requires digging a little deeper into the given justifications for freeing churches of property taxes.
When speaking out against the LB675, the director of the Nebraska Catholic Conference Jim Cunningham said the exemption “is firmly grounded in meeting human needs and serving the common good.” Sen. Beau McCoy echoed this sentiment and compared churches to other groups that provide helpful public services: schools and charitable non-profits. It appears, then, that churches are currently exempt from property taxes because they serve the community by offering beneficial services. Therefore, they deserve to be treated like other non-profits.
However, churches actually have an easier time achieving and maintaining tax exempt status than other charitable organizations. Simply by virtue of being affiliated with a faith, they avoid many of the bureaucratic hoops that charities must jump through to prove that they are really a non-profit when they file for tax exemption. Religious organizations also differ from charities on a very basic level. While non-profits must exist solely to provide public goods to the entire community, churches don’t. I’m not denying the fact that many religious organizations do charitable acts for their communities, but these acts are merely fortunate by-products of organized religion and not essential to its being in the way that it is to a non-profit. Trust me, I can already hear what you’re thinking: “But you’re not a real Christian/Jew/Muslim/Hindu/Buddhist/Rastafarian unless you’re serving other people!” Regardless of if this is true or not, it’s not relevant to this issue because the government only requires spiritual affiliation and not public works for churches to become exempt from paying taxes. This fundamental disconnect between the justifications given for tax exemption and the actual treatment of churches represents a governmental bias in favor of religion.
The First Amendment guarantees separation of church and state and any violation of this rule should not be taken lightly. But the issue becomes even more problematic when you consider who must carry the financial burden of religious tax exemption. All of the money that the government needs but can’t get from the church must instead be taken from taxpayers. This means that regardless of if a person practices religion or not, she must indirectly support churches by continually paying for their tax-exempt property. By not making churches pay property taxes, the government requires citizens who may be opposed to religion to fund it.
I firmly believe LB675 will help bring Nebraska’s government back in line with both the Constitution and its own stated reasoning. Even without considering the greater political implications of religious tax exemptions, the bill just makes good, pragmatic sense. Please consider calling your state representative today and expressing your support for the bill before it comes up to vote.
Kate Miller is a senior philosophy major. she also serves on the ASUN electoral commission. Reach her at email@example.com and follow her on Twitter @TheKateriarchy.