Tax concessions for religious institutions

by Sophie Timothy


In 2012, the Global Atheist Convention came to Melbourne with all the bells and whistles you’d expect of the intellectual class (oysters, champagne, the lot), and a speakers’ line-up to match: Richard Dawkins, Lawrence Krauss, Daniel Dennett, and Sam Harris, to name but a few. As expected, it was open season not just on religion, but specifically on Christianity.

During the conference, I wrote daily reflections for Eternity, Bible Society Australia’s news site, which included a piece on the lessons I learnt from attending the convention. Of these, one seemed to particularly strike a nerve among the Christian community, causing a war of words on social media. It was addressing an issue which kept cropping up again and again and which Christians, for the large part, accept without question. It wasn’t abortion, gay marriage, or the role of women in church. It was tax law.

Dr Leslie Cannold, a local ethicist, author, and activist, together with human-rights barrister Geoffrey Robertson QC, were among a handful of presenters at the convention who brought up the issue of tax breaks for religious institutions in Australia.

In order to qualify for tax concessions, a religious institution must be a registered charity and endorsed by the ATO. To be a registered charity, a religious institution must be not-for-profit, have a charitable purpose, and be for the public benefit. Lucky for Christians, the law recognises ‘advancing religion’ as a charitable purpose. And this is where people get up in arms.

Christians, Dr Cannold argued, had been given an unfair advantage by the Government, were exploiting tax-payers, and muddying the separation between church and state.

For those outside the church, it is not clear how ‘advancing religion’ is a charitable purpose, or in some cases necessarily for the public benefit. In the extreme, some see the church (and other religious institutions) as creating problems for society, not benefiting it.

I wasn’t so much concerned with this question of whether churches are conducting ‘charity’ by ‘advancing religion’: for the moment, the law deems we are; we can exercise our freedom to accept these tax concessions. But I did wonder whether or not — for the sake of gospel — we ought to accept them.

As I raised the issue of tax concessions with my colleagues in paid Christian work, and as the conversation grew on social media, the main response was one of standing on our rights, of accepting the blessing of tax laws which enable us to do our work more effectively. Because hey, if they’re offering it, why not take it?

But this argument doesn’t reflect the model held out to us in the Bible in the lives of Jesus and Paul. Philippians 2 tells us Jesus gave up his rights and authority: he humbled himself to become human and even to the point of death on a cross. His whole life was one of giving up freedom for the sake of others.

The Apostle Paul spends a whole two chapters in his first letter to the Corinthians explaining how he uses his freedoms for the sake of others — an argument which develops out of the question of whether or not to eat food sacrificed to idols.

From these chapters, it’s clear that Paul’s normal practice is to give up his freedoms for the sake of the gospel. He mentions a number of freedoms which he and his fellow apostles have given up: “the right to food and drink” (9:4), “the right to take a believing wife along” (verse 5), and the right to be paid (verse 12).

It is Paul’s choice to refuse payment in order to offer the gospel free of charge:

“What then is my reward?” he writes. “Just this: that in preaching the gospel I may offer it free of charge, and so not make full use of my rights as a preacher of the gospel. Though I am free and belong to no one, I have made myself a slave to everyone, to win as many as possible.” (1 Corinthians 9:18–19)

I wonder if those of us paid by Christian orgnisations ought to take Paul’s lead and choose to give up our rights to (nearly) tax-free income, or non-reportable fringe benefits, in order that the message we preach reaches those far off, who have been turned off by the hypocrisy of the church. Imagine the statement it would make if a whole denomination gave up tax concessions to send this message to the world: the gospel is free of charge, and we will not let financial loopholes get in the way. Imagine the stir.

Sophie Timothy is married to Tom, writes for Eternity, studies at Ridley Melbourne, and has recently started a photography business
( She has previously had paid roles in church and campus ministry.