Thus far, religious organizations enjoy across the board tax exemptions because of their charitable nature. In fact, they do not even have to submit tax filings. Many of these policies were enacted during the Eisenhower administration, but perhaps it is time to rethink these laws.
Over the past two decades, the rise in mega churches has created extreme wealth on the part of religious churches. Whereas the laws regarding their tax exemption status were designed to allow churches to better address the care of the poor and needy, there are successful preachers living in lavish mansions, driving expensive boutique sports cars, and doing what the Prophet Malachi called “robbing the poor” via the donations they collect.
Regardless, the small Alaskan town of Nome, population 3,800, is considering applying a tax of sorts on Churches. If they decide to move forward, it will be the first tax on religious Churches. The tax in question is the local sales tax.
Churches and charities get sales tax exemptions. In the city, this amounts to $300,000 in sales tax revenue they forfeit annually. However, the town is cash strapped. This has the city council mulling over whether to revoke the exemption for charities.
It is a poignant topic, but quite likely won’t amount to much of a savings for them. This is because churches and charities will simply go to neighboring cities to buy their goods and services and receive the exemption. As a result, the city will cause their local businesses to suffer in what would be aptly labeled the ordinance’s “unintended consequence”.