Huckabee (R): time for churches to give up tax-exempt status

[Grandma]

Furthermore, has Huckabee considered what this would do to poor churches that already struggle just to keep a service going? I live smack in the middle of the Bible Belt. There are at least 3 Baptist Churches within walking distance, and many more of nearly all other denominations except Catholic. While some of these have full pews, many of them (like the Church of God I attended before I... well, quit the faith, I guess) can barely get half-attendance. What's it going to do to them?

Just like personal taxes, the rate for churches would be on a sliding scale. Those making next to nothing pay no taxes.

 

[oldfart]

I feel that if churches are taxed, then so should schools, hospitals, and political/military funds.

I think there should be a distinction among the three types of tax benefits that churches get:
1. The benefits of being a tax-exempt organization, which they share with volunteer fire companies, mutual cemetery companies, labor unions, business leagues, and a host of others.
2. The benefit of having contributions to them tax deductible, which they share with all other 501(c)(3) organizations, like non-profit hospitals, medical research funds, non-profit cultural organizations like operas, symphonies, and theater companies, and scholarship funds.
3. Specific benefits available only to clergy and churches such as the exemptions from Social Security taxes.

Also note that all non-profits must pay tax at corporate rates on all "unrelated business income" (UBIT).

Personally, I favor eliminating all deductions for charitable contributions, which would moot most of what people are upset about with churches while retain tax exemption. It would be possible to define certain uses of donations which would be eligible for a tax credit on narrower grounds, not allowing credit for donations to institutional overhead or building costs. Churches could then establish separate funds for these purposes, bear the administrative expenses out of their general operating budget of non-creditable donations, and provide a tax credit to donors for monies actually spend for "charitable" (as opposed to religious purposes).

If we did this, IMHO, I think we could remove the prohibition against political activity of all 501 tax-exempt organizations and replace it with a rule making political activity expenditures UBI subject to tax. Thus taxpayer dollars would not be expended even indirectly to pay for someone else's political activities, government would not be nearly as involved in policing political speech, and no real changes would be needed in the rules for other tax-exempt categories (other than they could engage in political speech as long as they included such expenditures in their UBI!).