When the Church doesn't pay taxes

One of the main priorities of the Italian government, according to its mandate, should be fighting tax evasion. But it is unclear whether anything is being done to confront one of the biggest tax evaders -- the Catholic Church.

Cinzia Sciuto
Cinzia Sciuto MicroMega, Italy
Source: MicroMega
When the Church doesn't pay taxes - NewsMavens
Priest during communion. Pexels

Why this story matters:

Our society is only secular in appearance. In reality, religious organizations are granted privileges that should no longer be tolerated. There are religious teachers in public schools, religious officials in hospitals and in the armed forces, pastoral visits to offices and private homes, and blasphemy laws are still enforced. Ministers are exempt from certain traffic regulations. And the Eight per Thousand provision means the Catholic Church receives much more tax revenue than what it is voluntarily given by taxpayers.

Among the various privileges enjoyed by the Catholic Church, there is also a substantial -- but illegal -- exemption from the ICI, the tax on real estate. Thanks to a loophole, many buildings belonging to the Church are not taxed. In fact, it is enough that a building -- a hospital, a hotel, a school, headquarters for associations -- has a chapel for it to be declared a place of worship and be exempt from taxes.

The Court of Justice of the European Union has now requested that the Italian State find a way to recover building taxes unpaid by the Church. If this government succeeds where the others failed, it will be a step towards equality and secularization.

Details from the story:

  • The complicated Italian legislation ICI -- a form of property tax -- exonerates buildings owned by the Catholic Church, even buildings where commercial activities are carried out. There only needs to be a chapel in the building.
  • In 2005, a ruling of the Court of Cassation ordered the Italian state find a solution to this loophole.
  • Previous governments have always found a way to keep the tax privileges of the Church firmly in place.
  • On November 6, the Court of Justice of the European Union, which is charged with ensuring the correct interpretation and application of European law by EU member states and institutions, ruled that the Italian State must find a way to recover the ICI tax not paid by the Church for its commercial activities.
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