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Instead of Blessings, Italy Wants Church’s Cash

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I wonder how awkward it would be for the apostle Matthew to collect taxes from Jesus.  If it were me, I would feel uncomfortable taking money from the man who has the potential to determine my eternal outcome.  Do you suppose Saint Matthew let Jesus’ taxes slide?  But then again, Matthew would be robbing the general public of what was due to them.  Suppose we modernize this hypothetical tale.  Let’s substitute Matthew for Prime Minister Mario Monti, Jesus for the Catholic Church, and the biblical general public for the modern general public in present day Italy.

Many Europeans have been saying their prayers in hopes for an economic plan, primarily in  Spain, Portugal, Ireland, Greece and Italy.  While much of Europe stagnates through time due to numerous counteroffers, Italy is now the first one with a plan.  In 48 hours, former Prime Minister Silvio Berlusconi’s republic passed the Austerity Bill in December of last year.  The current Prime Minister, Mario Monti, now has to materialize an estimated amount of $40 billion.

According to macroeconomic theory, there are only three fiscal policies that a government can put into action; taxation, government spending and seignorage (informally known as the printing of a country’s currency).  Since seignorage is an economic “no-no,” Italy is left with two choices, leaving its citizens with much of the burden.

Soon after the Austerity Bill passed, an online petition with signatures of over 130,000 people was sent to the government saying that the Catholic Church should chip in on the tab.  Since 1982 and extended in 1996, the Church did not have to pay taxes on property that contained non-profit businesses which is one-fifth of Italy.  The total price of the 110,000 pieces of property amounts to roughly $12 billion dollars with annual taxes ranging from $650 million to $2.6 billion.  Only one difficulty arises;  its hard to define which buildings are used for secular purposes and which buildings are used for spiritual purposes.  Many secular buildings on the Church’s property contain a chapel while hotels house nuns and priests to avoid payment of taxes.

Of course, there is an added bonus as well.  Back in 2010, an Italian political party known as the Radical Party told the authorities that the Church had committed tax evasion.  Italian Radical Party Secretary Mario Staderini testified, “Our investigations have shown that some church properties which are deemed as being exempt from taxes are in fact being run as profitable hotels or hostels – the prices they charge are in line with four star hotels.”  Because all Church property was tax free, the Church allowed businesses, such as restaurants, hotels, shops and travel agencies, to operate on their own territory. Cardinal Angel Bagnasco spoke on the matter stating, “evading taxes is a sin,” and now wants action against the violators of the law.

With other European countries looking up to Italy as a role model, seeing that Italy possibly came up with a good idea, they are also interested in taxing the Church as well.  But what about America?   The United States already taxes only commercial Church property.  A list of what the American government can not tax includes non-profit hospitals, libraries, playgrounds and schools.

Some have argued that even the church building should be taxed as well.  In fact, Frederick Walz, a real estate owner, brought his case against the New York City Tax Commission to the Supreme Court.  He, a non believer, was indirectly and involuntarily supporting churches.    According to Oyez.org, a website of IIT Chicago-Kent College of Law, “Walz alleged that the exemptions forced him, as a taxpayer, to indirectly contribute to those churches.”  The Burger Court ruled against Walz stating that the tax exemptions did not violate the establishment clause.

All in all, taxing the church by itself is not really going to solve the debt crisis, even for Italy. However, every last penny counts.  For too long Italy relied on tourism too heavily to be a significant factor. factor in tax-paying?  In its current state, all the citizens can do is pay taxes.  To come out ahead is a different story.  If Italy were to come up with one product that can be useful to an Italian as well as the rest of the world, Italy’s unemployment rate would decrease as well as their debt to the rest of Europe.  There was a point in time where Italy did have the hottest product in all of the known world.  Of course, it caused serious repercussions within the Church. However, the selling of indulgences back in the Middle Ages was a very lucrative business.

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Instead of Blessings, Italy Wants Church’s Cash