Congress Has Failed to Rescind Provision Requiring Churches to Pay Taxes

Sen. James Lankford of Oklahoma and Rep. Mark Walker of North Carolina are among members of Congress seeking to halt a measure requiring churches to file tax returns.

Congress has failed, to this point, to heed the latest urgent request from a coalition led by the Southern Baptist Ethics & Religious Liberty Commission to rescind a provision in federal law requiring churches to file tax returns for the first time in American history.

In a March 1 letter, ERLC President Russell Moore and 11 other organizational leaders called on House of Representatives committee leadership to act quickly in this tax season to correct the controversial measure.

The provision — Section 512(a)(7) of the Tax Cuts and Jobs Act of 2017 — requires houses of worship and other nonprofits to pay a 21 percent tax on such employee benefits as parking and transportation. The measure, which took effect Jan. 1, 2018, will cost the charitable sector an estimated $1.7 billion over 10 years, the ERLC-led coalition said in the letter. Opponents of the provision also have said it will burden churches and others with accounting and compliance costs not previously required.

In November, the ERLC led a 33-member coalition that urged congressional leaders to repeal the section before the end of the year, but the effort fell short. The House voted 220-183 in December to reverse the provision, but the Senate did not have the votes to approve the measure.

“It has been months since we have raised this issue with legislators,” Moore told Baptist Press in written comments. “There has been a great deal of rhetoric but no results. We now find ourselves weeks away from the tax deadline while many elected officials seem to hope this issue will get lost in the circus of the daily news cycle.

“The freedom of the church is too important of an issue to let unmotivated elected officials threaten it,” Moore said. “Uncle Sam is welcome in our churches. But we don’t work for him. And Congress should end this deeply un-American tax on churches immediately.”

The latest letter — which went to Reps. Richard Neal, D-Mass., and Kevin Brady, chairman and ranking member, respectively, of the House Ways and Means Committee — said the signers “are concerned about the troubling precedent this sets by entangling the [International Revenue Service] with houses of worship.”

Churches and other religious bodies and nonprofits “exist to serve the needs of their local communities,” Moore and others said in the March 1 letter. The cost is likely to increase beyond the predicted $1.7 billion in the next decade, they said, as churches and others “are forced to shift resources from serving their charitable mission to dealing with paying this burdensome federal tax.”

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Source: Baptist Press