Misplaced Pages

Latest revision as of 15:28, 14 November 2024

The examples and perspective in this article deal primarily with Europe and do not represent a worldwide view of the subject. You may improve this article, discuss the issue on the talk page, or create a new article, as appropriate. (June 2017) (Learn how and when to remove this message)

Part of a series on
Taxation
An aspect of fiscal policy
Policies Government revenue Property tax equalization Tax revenue Non-tax revenue Tax law Tax bracket Flat tax Tax threshold Exemption Credit Deduction Tax shift Tax cut Tax holiday Tax amnesty Tax advantage Tax incentive Tax reform Tax harmonization Tax competition Tax withholding Double taxation Representation Unions Medical savings account
Economics General Theory Price effect Excess burden Tax incidence Laffer curve Optimal tax Theories Optimal capital income taxation Distribution of Tax Tax rate Flat Progressive Regressive Proportional
Collection Revenue service Revenue stamp Tax assessment Taxable income Tax lien Tax refund Tax shield Tax residence Tax preparation Tax investigation Tax shelter Tax collector Private tax collection Tax farming
Noncompliance General Tax avoidance Repatriation tax avoidance Tax evasion Tax resistance Tax shelter Debtors' prison Smuggling Black market Unreported employment Corporate Tax inversion Transfer mispricing Base erosion and profit shifting (BEPS) Double Irish Dutch Sandwich Single Malt CAIA Locations Tax havens Corporate havens Offshore financial centres (OFCs) Offshore magic circle Conduit and sink OFCs Financial centres Financial Secrecy Index Major examples Ireland as a tax haven Ireland v. Commission Leprechaun economics Liechtenstein tax affair Luxembourg Leaks Offshore Leaks Paradise Papers Panama Papers Swiss Leaks United States as a tax haven Panama as a tax haven
Types Direct Indirect Per unit Ad valorem Aviation Airport improvement Landing Solidarity Capital gains Expatriation Consumption Departure Hotel Sales Stamp Television Tourist Value-added Dividend Environmental tax Carbon Eco-tariff Landfill Natural resources consumption Severance Steering Stumpage Excise Alcohol Cigarette Fat Meat Sin Sugary drink Tobacco General Georgist Gift Gross receipts Hypothecated Income Inheritance (estate) Land value Luxury Payroll Pigouvian Property Resource rent Single Surtax Turnover Use User charge/fee Congestion Fuel Road/GNSS Toll Vehicle miles traveled Corporate profit Excess profits Windfall Negative (income) Wealth
International Financial transaction tax ATTAC Currency transaction tax European Union Common Consolidated Corporate Tax Base (CCCTB) Global minimum corporate tax rate Robin Hood tax Tobin tax Spahn tax Tax equalization Tax treaty Exchange of Information Permanent establishment Transfer pricing European Union FTT Foreign revenue rule
Trade Custom Duty Tariff Import Export Tariff war Free trade Free-trade zone Trade agreement ATA Carnet
Research Academic Mihir A. Desai Dhammika Dharmapala James R. Hines Jr. Ronen Palan Joel Slemrod Gabriel Zucman Advocacy groups Institute on Taxation and Economic Policy (ITEP) Oxfam (UK) Tax Foundation (US) Tax Justice Network (TJN) Tax Policy Center (US)
Religious Church tax Eight per thousand Teind Tithe Fiscus Judaicus Leibzoll Temple tax Tolerance tax Jizya Kharaj Khums Nisab Zakat
By country All Countries List of countries by tax rates Tax revenue to GDP ratio Tax rates in Europe Individual Countries Albania Algeria Argentina Armenia Australia Azerbaijan Bangladesh Bhutan Brazil Bulgaria BVI Canada China Colombia Croatia Denmark Finland France Germany Greece Hong Kong Iceland India Indonesia Iran Ireland Israel Italy Japan Kazakhstan Lithuania Malta Morocco Namibia Netherlands New Zealand Norway Pakistan Palestine Peru Philippines Poland Portugal Russia South Africa Sri Lanka Sweden Switzerland Taiwan Tanzania United Arab Emirates United Kingdom United States Uruguay
Business portal Money portal
v t e

A church tax is a tax collected by the state from members of some religious denominations to provide financial support of churches, such as the salaries of its clergy and to pay the operating cost of the church. Not all countries have such a tax. In some countries that do, people who are not members of a religious community are exempt from the tax; in others it is always levied, with the payer often entitled to choose who receives it, typically the state or an activity of social interest.

The constitution of a number of countries could be and have been interpreted as both supporting and prohibiting the levying of taxes unto churches; prohibiting church tax could separate church and state fiscally, but it could also be favorable treatment by the government. The term "church tax" could mean a tax levied on a religious organisation by a state, or relate to tax exemptions and so on for churches, but this article is about a tax levied on individuals.

Tithing

In the past it was usual for people to be expected to pay a part of their production (e.g., agricultural produce) or income to a church, a practice known as tithing. This was often obligatory. It is no longer enforced by civil rulers, but some religious organisations still expect or require their members to pay a tithe.

Countries that levy a church tax

Austria

Every recognized religious group in Austria can collect church tax at a rate of 1.1%, though currently only the Catholic and Protestant churches make use of that opportunity. Church tax is compulsory for Catholics in Austria.

This tax was introduced into Austria by the German government in 1939 after the 1938 Anschluss (annexation of Austria into Germany). After Austria received national independence again after World War II the tax was retained in order to keep the churches independent of political powers.

Denmark

The members of the national Church of Denmark pay a church tax, called "kirkeskat". The rate varies among municipalities with a minimum of 0.4% and a maximum of 1.3% of taxable income in 2019. The tax is generally around 0.7% of taxable income. The collection of the church tax is administered by the Danish tax authorities, but the church tax is not considered as a genuine tax by, for example, Statistics Denmark, but as a "voluntary transfer from households to the state".

The church tax does not cover the entire budget of the Church of Denmark. An additional 9% is paid by the government through block grants ("bloktilskud"), which means that even people who are not members of the Church of Denmark finance its activities through taxes.

Finland

All members of the Evangelical Lutheran Church of Finland and the Finnish Orthodox Church, the two state churches of Finland, pay an income-based church tax of between 1% and 2% (average about 1.4%), depending on the municipality. Members can formally leave the church, becoming exempt from the tax from the following year. Studies have found that people leave the church in Finland mainly due to the general secularization of society, not to become exempt from the tax.

Germany

About 70% of church revenues come from church tax (Kirchensteuer), also called worship tax (Kultussteuer) when referring to non-Christian religious bodies such as Jewish synagogues. This was about €13.1 billion in 2022.

Article 137 of the Weimar Constitution of 1919 and article 140 of the German Basic Law of 1949 form the legal bases for this practice.

In Germany, on the basis of tax regulations passed by the religious communities and within the limits set by state laws, communities may either:

• require the taxation authorities of the state to collect the fees from the members on the basis of income tax assessment (then, the authorities withhold a collection fee), or
• choose to collect the church tax themselves.

In the first case, membership in the religious community is stored in a database at the Federal Tax Office which employers receive excerpts of for the purpose of withholding tax on paid income. If an employee's data indicate membership in a tax-collecting religious community, the employer must withhold church tax prepayments from their income in addition to other taxes. The state revenue authorities assess the church tax due at the annual tax assessment. State revenue authorities collect prepayment of church tax (and income tax) from self-employed persons and unemployed taxpayers.

If, however, religious communities choose to collect church tax themselves, they may demand that the tax authorities reveal taxation data of their members to calculate the contributions and prepayments owed. In particular, some smaller communities (e.g., the Jewish Community of Berlin) choose to collect taxes themselves to save collection fees the government would charge otherwise.

Church tax collected may be used to cover any church-related expenses such as funding institutions and foundations and paying ministers.

The church tax is only paid by members of the respective church, although the concept of "membership" is far from clear, and it may be asked what right the secular state has to tell the faithful what contribution they should make to their own denomination. People who are not members of a church tax-collecting denomination do not have to pay it. Members of a religious community may formally cease to be considered members by making a declaration to state (not religious) authorities, ending liability to pay church taxes. Some religious communities refuse religious marriages and funerals to members who leave.

The money flow of state and churches is distinct at all levels of the procedures. Income on which church tax is paid is not subject to state income tax (as are voluntary contributions to the Church, for charity or other privileged purposes), so that in effect the state subsidises the church to some extent. The cost to the state of collecting church tax is reimbursed by the church.

The church tax is historically rooted in the pre-Christian Germanic custom whereby the chief of the tribe was directly responsible for the maintenance of priests and religious groups. During the Christianization of Western Europe, this custom was adopted by the Catholic and Arian churches in the concept of "Eigenkirchen" (churches owned by the landlord), which stood in strong contrast to the central church organization of the Catholic Church. Despite the resulting medieval conflict between emperor and pope, the concept of church maintenance by the ruler remained the accepted custom in most Western European countries. In Reformation times the local princes in Germany became officially heads of the church in Protestant areas, and were legally responsible for the maintenance of churches. Not until the 19th century were the finances of churches and state regulated to a point where the churches became financially independent. At this point, the church tax was introduced to replace the state benefits the churches had obtained previously.

The church tax was reaffirmed in Article 13 of the Concordat between Nazi Germany and the Vatican, which guaranteed the right of the Church to levy taxes. Taxpayers, whether Catholic, Protestant or members of other tax-collecting communities, pay an amount equal to 8% in Bavaria and Baden-Württemberg, and 9% in the rest of the country, of their income tax to the church or religious community to which they belong. For example, a person earning €50,000 may pay income tax at 20% (€10,000); the church tax is an additional 8% (or 9%) of that sum (€800 or €900). The paid church tax is deductable in year of paying and reduces the taxable income.

Since 2015, private companies have to take part at the "church tax deduction procedure" ("Kirchensteuerabzugsverfahren"). This should ensure, that also shareholder of private companies pay church taxes on dividends. This regulation was introduced because capital gains in Germany can be taxed at a flat rate since 2009 and therefore do not have to be declared in the income tax return. There was therefore an enforcement deficit.

In 2017, Germany's Catholic church recorded approximately €6 billion tax take, split across its 27 different dioceses or church districts, despite a massive dip in attendance (according to the newspaper Handelsblatt, church attendance had dropped by more than 2.2 million since the start of the millennium). Fifty years before Catholic church attendance exceeded 11 million, but had dropped to 2.5 million. The German Church also has a total fortune of at least €20 billion. The three highest-income dioceses are Paderborn, at €3.5 billion, Munich at €2.8 billion, and Cologne at €2.6 billion.

People moving to Germany must declare their religious affiliation. The state-administered church tax is very successful at compelling tax payment, but many residents can avoid paying it, for example by not being a practising member of a faith. This has led to many people declaring they have abandoned the religion of their birth; it is not known what proportion do this only to avoid the tax.

Iceland

Taxpayers in Iceland who belong to an officially registered religious group or secular humanist organization must pay a congregation tax (Icelandic: sóknargjald, plural sóknargjöld) which is deducted from income taxes and goes to their organization. The sóknargjald of those who did not belong to any recognized religious organization formerly went to the University of Iceland. This was changed in 2009; people not belonging to a registered religious group or secular humanist organization must pay the same amount in tax, which is treated as income tax rather than paid to a church. In 2015, the monthly sóknargjald amounted to 824 krónur, about $US6. In March 2021, Judaism was added to Iceland’s list of state-recognised religious groups.

The Church of Iceland receives governmental support beyond the congregation taxes paid by its members.

Italy

Taxpayers in Italy pay a mandatory eight per thousand tax, and have the option to choose to whom they will assign the funds. This tax amounts to 0.8% of the total income tax (IRPEF) and every taxpayer can choose the recipient of the contribution on their tax form. Regardless of whether the taxpayer expresses a preference or not, the 0.8% is already included in their tax levy.

Currently the choices are:

• Italian State
• Catholic Church
• Waldensian Evangelical Church
• Seventh-day Adventist Church
• Assemblies of God in Italy
• Union of the Jewish Communities in Italy
• Lutheran Evangelical Church in Italy
• Baptist Evangelical Christian Union of Italy
• Greek Orthodox Archdiocese of Italy
• Apostolic Church in Italy (Pentecostalism)
• Italian Buddhist Union
• Italian Hindu Union

If the choice is not expressly declared on the tax form, the tax is distributed according to the percentages of the taxpayers who have declared their choice of beneficiary. While it was intended that the state should use its own share of the 0.8% tax for social or cultural purposes, in practice it has employed it for general purposes including its military mission in Iraq in 2004 and the upgrading of prison infrastructure in 2011.

Spain

The Spanish tax declaration form has a checkbox that allows the taxpayer to allocate 0.7% of their taxes to support the Catholic Church. This checkbox does not influence the total taxes paid; leaving the checkbox blank allocates the same money for general purposes.

Sweden

The members of Church of Sweden pay church fee, which varies between municipalities, but can be as much as 2%. Church and state are separated as of 2000; however, the burial tax (begravningsavgift) is paid by everyone regardless of membership.

In a recent development, the Swedish government has agreed to continue collecting from individual taxpayers the annual payment that has always gone to the church. But now the fee will be an optional checkoff box on the tax return. The government will allocate the money collected to Catholic, Muslim, Jewish and other faiths as well as the Lutherans, with each taxpayer directing where his or her taxes should go.

Switzerland

There is no official state church in Switzerland. However, except Geneva and Neuchâtel, each canton (state) financially supports at least one of the three traditional denominations – Catholic, Old Catholic (in Switzerland Christian Catholic Church of Switzerland), or Evangelical Reformed – with funds collected through taxation. Each canton church tax may formally have to leave the church. In some cantons private companies are unable to avoid payment of the church tax.

In Geneva and Neuchâtel there is no church tax; each taxpayer is free to make a voluntary tax deductible contribution or gift to his church, either directly to the beneficiary or using the canton (state) tax system.

Countries that have ended church taxes

England

There has long been no church tax in United Kingdom. Tithing was obligatory in England centuries ago.

France

France abolished the church tax in 1789.

Mexico

Mexico abolished the church tax in 1833.

United States

The English colonies which later became the United States had tax provisions to support religion, but the Constitution of the United States explicitly separates church and state, and no church tax is levied from citizens. Churches are generally exempt from paying taxes. The United States Supreme Court has held that tax exemption for churches is constitutional under the Establishment Clause and that churches and religious organizations may be subject to a general sales and use tax; however, the Court has not addressed whether government may enact a specific "church tax". The Establishment Clause of the US Constitution prohibits the US federal government and (through incorporation doctrine) the 50 state governments from establishing a state religion or favoring one religion over another.

Prior to American independence, most of the original colonies supported religious activities with taxes, with each colony often choosing a single church as their official religion. These official churches enjoyed privileges not granted to other religious groups. Massachusetts and Connecticut supported the Congregational church through tax. In colonial South Carolina, the Anglican Church benefited from church taxes. Other colonies would more generally support religion by requiring taxes that would partially fund religious institutions - taxpayers could direct payments to the Protestant denomination of their choosing. Only the colonies of Delaware, New Jersey, Pennsylvania and Rhode Island did not require a tax to support religion. During and after the American Revolution, religious minorities, such as the Methodists and the Baptists, argued that taxes to support religion violated freedoms won from the British. Defenders of the practice argued that government needed to fund religious institutions because public virtue depended on these institutions which could not survive purely on private support.

See also

• Concordat
• 501(c)(3) organization, U.S. tax-exemption for churches, religious organizations, charities, and certain other nonprofit organizations
• Clergy housing allowance, income not subject to federal income tax that is paid to ordained ministers in both Canada and the United States
• Otto per mille
• Peter's Pence
• State religion
• Tithe

References

1. "Should Churches (Including Mosques, Synagogues, etc.) Remain Tax-Exempt?". Britannica ProCon. Encyclopedia Britannica. Retrieved August 5, 2020.
2. McClenaghan, Maeve (29 November 2022). "'Exposed to horrendous things': young people in UK speak out against evangelical church". The Guardian.
3. "Austria's perilous journey". Thetablet.co.uk. Archived from the original on 2009-05-02. Retrieved 2013-09-03.
4. ""Kommuneskatteprocenter 1977-2019 i regneark". Home page of Danish Ministry of Taxation, published 6 November 2017, accessed 19 January 2019". Archived from the original on 19 January 2019. Retrieved 19 January 2019.
5. ""Skatteberegning - hovedtrækkene i personbeskatningen 2018". Home page of Danish Ministry of Taxation, published 17 November 2017, accessed 19 January 2019". Archived from the original on 19 January 2019. Retrieved 19 January 2019.
6. "Nationalregnskab og offentlige finanser ESA 2010 - Hovedrevison 2014. Report published by Statistics Denmark in September 2014. Quotation from page 52 (in English summary)". Archived from the original on 2019-01-19. Retrieved 2019-01-19.
7. "Folkekirken i et samfundsøkonomisk perspektiv" (PDF). Archived (PDF) from the original on 2016-07-06. Retrieved 2016-06-12.
8. "Eroakirkosta.fi - Kirkollisverotus kiristynyt 2010-luvulla". 19 December 2015. Archived from the original on 2016-07-31. Retrieved 2016-07-24.
9. "Einnahmen durch die Kirchensteuer in Deutschland bis 2022".
10. ^ "German Catholics lose church rights for unpaid tax". BBC News. 2012-09-24. Retrieved 2021-06-07.
11. "Germany | Hitler's concordat (1933)". Concordat Watch. Archived from the original on 2017-09-18. Retrieved 2019-09-06.
12. "The politics of appointments to protestant theological faculties in Germany: the case of professor Erich Geldbach". Accessmylibrary.com. Archived from the original on 2010-09-28. Retrieved 2013-09-03.
13. "Kirchensteuerabzugsverfahren in der Praxis: Leitfaden für GMBH-Geschäftsführer - TAXURA".
14. ^ Bureau of Democracy, Human Rights and Labor (2014). "International Religious Freedom Report for 2014: Iceland". U.S. Department of State. Retrieved 2015-12-07.
15. ^ "Kirkjumál og skráð trúfélög og lífsskoðunarfélög" (in Icelandic). Ministry of the Interior (Innanríkisráðuneytið). Archived from the original on 2016-03-23. Retrieved 2015-12-07.
16. Bureau of Democracy, Human Rights and Labor (2004). "International Religious Freedom Report for 2004: Iceland". U.S. Department of State. Retrieved 2015-12-07.
17. "Frumvarp til laga um ráðstafanir í ríkisfjármálum" (in Icelandic). Alþingi. 2009. Archived from the original on 2015-12-08. Retrieved 2015-12-07.
18. Iceland adds Judaism to list of state-recognised religions
19. "In Iraq l'8 per mille destinato all'arte" Archived 2015-05-10 at the Wayback Machine - Corriere della Sera 10 November 2006
20. Servizio Studi - Dipartimento bilancio (A) (2008-09-22). "Camera dei deputati Dossier BI0026". Documenti.camera.it. Archived from the original on 2015-04-25. Retrieved 2013-09-03.
21. Carlo Alberto Bucci (2011-12-29). "Carlo Alberto Bucci, "I beni artistici restano a secco i 57 milioni dell'8 per mille vanno all'emergenza carceri" in La Repubblica, 29 December 2011. Retrieved 3 May 2012" (in Italian). Ricerca.repubblica.it. Archived from the original on 14 January 2012. Retrieved 2013-09-03.
22. "¿Qué hace Hacienda con tu dinero si no marcas la casilla solidaria ni la Iglesia en la declaración de la renta?". El Periódico (in Spanish). 2022-06-23. Retrieved 2022-07-31.
23. "Die Kirchensteuern". Swiss national tax office (in German). Archived from the original on 24 September 2015. Retrieved 30 November 2014.
24. "Les Eglises de Neuchâtel encouragent le versement de l'impôt ecclésiastique". www.rts.ch/. 12 September 2019. Retrieved 22 November 2019.
25. Blackstone, William (1766). Commentaries on the Laws of England vol II. Oxford: Clarendon Press.
26. "Suspensión del diezmo eclesiástico".
27. Internal Revenue Service. "Tax Guide for Churches and Religious Organizations" (PDF). Retrieved July 4, 2021.
28. "Walz v. Tax Comm'n, 397 U.S. 664 (1970)". Legal Information Institute. Cornell Law School. Retrieved July 4, 2021.
29. "Jimmy Swaggart Ministries v. California Bd. of Equalization, 493 U.S. 378 (1990)". Legal Information Institute. Cornell Law School. Retrieved July 4, 2021.
30. "Tax Exemptions of Religious Property". Legal Information Institute. Cornell Law School. Retrieved July 4, 2021.
31. "Incorporation Doctrine". Legal Information Institute. Cornell Law School. Archived from the original on July 3, 2018. Retrieved July 3, 2018.
32. "Establishment Clause". Legal Information Institute. Cornell Law School. Retrieved July 4, 2021.
33. ^ "Public Funding of Religious Activity in 18th-Century America". www.pewforum.org. May 14, 2009. Retrieved October 25, 2020.
34. Bremer, Francis J. (1995). The Puritan Experiment: New England Society from Bradford to Edwards (Revised ed.). University Press of New England. p. 226. ISBN 9780874517286.
35. Bolton, S. Charles (1982). Southern Anglicanism: The Church of England in Colonial South Carolina. Westport, Connecticut: Greenwood Press. pp. 24–26. ISBN 9780313230905.

• Christianity and government
• Personal taxes
• Religious taxation
• Catholic Church and finance
• Religious law