A day of reckoning for state and federal governments over the tax-free status of Australia’s largest religious institutions is well overdue according to Victorian Upper House MP and Leader of REASON, Fiona Patten MLC.
Successive governments have enabled the Catholic Church to amass a tax-free property and business portfolio valued at over $30 Billion making it the largest non-government property owner in Australia. In Victoria, the Catholic Church has businesses, buildings, property, schools, hospitals, car parks, conference centres and many other money making businesses, all assets valued at over $9 billion.
“I am currently finalising my bill for its second reading which seeks to ensure tax exemptions for charities only apply to organisations engaged in ‘objectively charitable works’. The so-called advancement of religion as a charitable status and its tax exemption must stop. Profitable businesses making lots of money should pay their fair share of tax, just like the rest of us,” Ms Patten explained.
Some 37% of all registered charities report ‘advancement of religion’ as their charitable purpose. Australia’s most recent census indicated a rapid decline in religious belief, suggesting these organisations are not delivering on their primary purpose for being in existence.
This is how the “Charities Amendment (Charitable Purpose) Bill 2017” will work:
– Most people understand a charity to be ‘an organisation set up to provide help and raise money for those in need’ and we want Victoria’s laws to reflect this. Genuine charitable work, including the charitable work performed by religious institutions, should be tax exempt. However, the current construction of ‘advancement of religion’ as a charitable head permits something else.
– Many commercial enterprises owned by religious institutions are exempt from certain taxes because of their charitable status, despite not carrying out objectively charitable works. This means that many highly profitable businesses are receiving tax exemptions from usual business costs, such as land tax and payroll tax. Paying its ‘fair share of tax’ does not abrogate the ability of a business like this to generate profit for the church (just as normal businesses pay tax and return a profits to shareholders).
– Deleting ‘advancement of religion’ from the definition of a charity is how we intend to resolve this issue. Religious institutions will then retain charitable status for their genuinely charitable activities only.
Earlier today during the Financial and Performance Outcomes Public Hearing, Ms Patten asked David Martine, Secretary for Treasury and Finance to quantify the amount of state revenue that stamp-duty, land tax and other state taxes would be generate if the Church was no longer exempt. The department has taken the question on notice.
– Fiona Patten MP, 12.02.18