Max Wallace, director of the Australian National Secular Association, writing in The Australian, welcomes the Treasury review of tax concessions to religious charities. However, he also notes a disturbing definition of “charity,” a residue of Elizabethan English law, that has made it difficult for courts and legislatures to determine the limits of tax exemption for churches:
The Statute of Elizabeth (I) of 1601 created four heads of charity: the relief of poverty; advancement of education; advancement of religion; other purposes beneficial to the community. Historically, monarchs and churches had usually been tax-exempt. [. . .]
All religious organisations that satisfy the legal definition of religion in Australia are tax-exempt. The Australian Taxation Office makes these determinations when organisations apply. The definition of religion in Australia was decided in the 1983 High Court Scientology case, in which the court defined religion as any belief in a supernatural being, thing or principle and canons of conduct that give effect to that belief. An organisation must have a building, be paying a stipend to a minister with a congregation, perform rituals and be open to the public.
Second, in Australia, under our charity law the dominant purpose of a religious organisation’s activities must be the “advancement of religion”. It does not matter if the religious organisation is running a commercial business, so long as the dominant purpose of the activity is religious.
This opens the door for any religious organisation to tithe its members, parlay the donations into a considerable sum, then invest it in a commercial business or investment whose profits will be tax-exempt. All things being equal, with tax-exempt status, a business can grow quickly. There is no requirement for any of these profits to be applied to the relief of poverty or any of the many other charitable causes because the advancement of religion, that 17th-century idea, is deemed to be charitable in itself. It does not matter what kind of religion it is, so long as it has a supernatural belief.
Wallace mentions the Grassley hearings into the financial shenanigans of prosperity churches in the US, where obscenely-wealthy televangelists have claimed tax-exemptions for multi-bathroom Pacific oceanside mansions by classifying them as “parsonages”—a sign that churches there no longer appear to enjoy the carte-blanche they once did under the Bush Administration regarding what does and what does not count as tax-exempt. Whether the Australian Treasury will have similar success holding Australian churches’ proverbial feet to the flame will depend on how Queenie’s definition of charity will be interpreted.