Advancement of Religion as Charitable Purpose In Question
15 December 2017 at 10:15 am
Whether the advancement of religion should be considered a charitable purpose is coming under scrutiny in Victoria.
Victorian Upper House MP, Fiona Patten read a bill in the Victorian Parliament on Thursday to amend the Charities Act 1978 to exclude the advancement of religion as a charitable purpose.
According to Patten the bill is the first step toward parliamentary debate around the country to allow religious institutions in Australia to be taxed, although the charity sector has voiced concerns that each state and territory would be operating with a separate definition of charity.
Patten told Pro Bono News her motivation “first and foremost” was to provide greater transparency of these organisations.
“Currently many large organisations do not have to provide any financial accountability around the funds that they raise and those funds, whether raised through commercial purposes and in competition with other commercial enterprises, they are very often exempt from many state and federal taxes, so my bill intends to rectify that to a degree, in regards to some of the state taxes, the land tax, payroll tax, some of the duties that are regulated by state government,” Patten said.
Under The Charities Act 2013 there are 12 charitable purposes that define what the organisation was set up to achieve.
According to the Australian Charities Report 2016, “advancing religion” was the most common charitable purpose, reported by 32 per cent of charities.
The most common main activity was religious activities reported by 30.8 per cent of charities.
Patten, who formed the Australian Sex Party in 2009, said her amendment would ensure that tax exemptions for charities in Victoria only applied to those organisations engaging in “objectively charitable works”.
The bill would also see amendments to the Duties Act 2000, the Payroll Tax Act 2007 and the Land Tax Act 2005.
Patten said the “notion that the advancement of religion is a charitable purpose, would be questioned by most people in our community these days”.
“I suspect most of them [have additional purposes] but it might be that not all of the work that they do and not all of the income that they receive is being put to what most of us in the community would consider charitable purposes and that is helping the homeless, and providing relief for people in poverty for example,” she said.
“I suspect many of them would be providing those services but I would like to see far greater scrutiny and I would like to see the notion that the advancement of religion is a charitable purpose [questioned].
“I think society has moved on from that. Less than 8 per cent of people go to church or go to the mosque or go to the synagogue, I don’t believe that the community thinks that advancement of religion is acceptable charitable purpose.”
She said commercial enterprises owned by religious institutions should be subject to the same legal and financial laws as other commercial entities.
“Taxing these types of businesses makes common sense” she said.
“And taxing them fairly does not inhibit their ability to generate profit for the church, it just ensures that the state benefits too. It also importantly provides much needed transparency.”
Patten, who has been a contributor to the debate around child sex abuse in religious orders and who published a dossier in 2000 called Hypocrites on the sexual abuse of children within religious institutions, said the bill was partly born out of the royal commission.
“These organisations have operated in a kind of shroud of silence and some of that has been able to cover up child sex abuse and I’m not suggesting that my bill would have exposed that, but I think bringing any increased accountability on these organisations will assist on shining a light on these organisations, and that will have the effect I would hope of picking up abhorrent behaviour,” she said.
“At the moment most of these organisations don’t even put in a tax return, so you have no idea how they are spending their money, you have no idea how they are distributing the commercial rents they receive from the properties that they own. By starting to require some accountability to that we will start to see greater transparency and we will start to see that the money that they raise is being used for charitable work, that it is not being used to pay exorbitant executive salaries, that it is not being paid to further invest in commercial enterprise.”
She said she would like to see similar types of legislative reform occur at a federal level as well.
“I would also like to see, the exemptions to other pieces of legislation like the Discrimination Act questioned and queried, but at the moment we are questioning whether they should have greater protections, I would argue from what we have found in the royal commission we should not be giving them greater protections, we should be requiring that they have greater accountability,” she said.
“I think this is the first time in Australia that this type of legislation has been proposed so I expect that this will require a long conversation about this and I think really reflecting on what the community expects from our exemptions.”
However many in the charitable sector have raised concerns about changing the definition of charitable purpose.
Community Council for Australia CEO David Crosbie told Pro Bono News advancing religion had been a charitable purpose for more than 400 years and he was worried about moves by Victoria to abolish advancing religion as a charitable purpose for several reasons.
“Firstly I believe we cannot have each state and territory operating with a separate definition of charity – it would make the existing nightmare of red tape and compliance in areas like fundraising even more complex,” Crosbie said.
“CCA has consistently argued for all charity regulators at every level of government to use the Charities Act 2013 we all worked so hard to agree on and get through federal Parliament.”
He said society also needed to be very careful about trying to exclude charitable purposes that “happen to be waning in popularity”.
“There is no doubt that advancing religion used to have more supporters in years gone by, and levels of trust in religious institutions has declined to an all time low, but picking off charitable purposes that are unpopular or have limited support is not a good precedent,” he said.
“I may not agree with all causes and all charities, but I will defend their right to represent their causes and communities.
“Thirdly, I believe transparency is the key to both accountability and trust. If people are unhappy with the performance of any charity, including those claiming to advance religion, we should push to hold those charities to account as we are now starting to do around sexual abuse of children.
“Dropping organisations from charities registers etc. is not going to advance transparency.”
He made a clear distinction between questioning the actions of charities and removing their charitable status.
“My personal view is that many traditional religious organisations are clearly going through a tough time – ageing congregations, lower numbers attending church regularly, drifting of purpose and ideology, less community engagement,” he said.
“Increasingly the community are asking churches to demonstrate their public benefit and act out their faith and belief beyond the boundaries of their church.
“I support questions being asked of traditional religious organisations about what they do with their resources and what public benefit they offer, but that does not mean I want their charitable status revoked.”