Taxing profits and income of clergy and church-run schools
Speaker Pantaleon Alvarez has recently been in the news, wanting to impose taxes on church-run schools (“Alvarez wants religious schools taxed,” News, 3/7/17).
I do not claim to be a tax expert, but in my humble opinion the Speaker cannot do it by simply filing the corresponding bill in Congress, as he did in his eagerness to restore the death penalty.
Methinks any such legislation would be unconstitutional for as long as Article VI, Section 28(3) of the present Charter exists: “Charitable institutions, churches and parsonages or convents appurtenant thereto, mosques, nonprofit cemeteries, and all lands, buildings, and improvements, actually, directly and exclusively used for religious, charitable, or educational purposes shall be exempt from taxation.” On the other hand, amending this provision to suit his purpose would take a relatively more difficult and much longer process.
That said, I believe, though, that the door is not totally closed for government to find out, at the very least, if church-run educational institutions should be taxed or not. Even if they are registered as nonprofit and nonstock corporations, they are certainly making profits. And so, the final test of their immunity or exemption from tax should be whether or not the profits they make eventually personally benefit particular private individuals.
Of course, the immediate assumption is they don’t because they are not stockholders. The thing is, has the tax bureau indeed ever verified this matter completely and beyond doubt? As such—meaning, the profits they make are merely being plowed back into their operations in order to improve the quality of education they provide—then, Alvarez may not have a truly valid axe to grind.
That is, of course, on the assumption that he filed the bill for a reason other than to exact vengeance on the Catholic clergy for their continuing vocal and vehement stand against the present administration’s war on drugs and consuming desire to restore the death penalty. Otherwise, perhaps Alvarez might just as well also endeavor to find out, through the auspices of the Bureau of Internal Revenue, if all priests do really file tax returns and include in their annual taxable income their share of baptismal, wedding, death and other fees they receive from well-meaning parishioners, on top of their basic salaries.
RUDY L. CORONEL, firstname.lastname@example.org
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