Today, the Rationalist Society of Australia has written a letter to Andrew Leigh MP, the Labor spokesperson on charities, calling on him to expand the focus of his proposed inquiry beyond the Church of Scientology.

We think it’s time for a parliamentary inquiry into the automatic tax-exempt status accorded to all religious organisations and to consider the introduction of a new requirement for them to demonstrate that their activities are in the public benefit.

Here is the letter:

Dear Mr Leigh,

The Rationalist Society of Australia (RSA) vigorously supports your push for a federal parliamentary inquiry into the Church of Scientology, following media reports of the organisation shifting wealth and assets to Australia, where it enjoys tax concessions.

However, we suggest the inquiry should focus on reviewing not just one organisation but the automatic tax-exempt status accorded to any and all organisations that claim ‘religious’ status.

We urge you, as Opposition spokesperson on charities, to broaden the scope of such an inquiry to cover all organisations that currently enjoy tax-exempt status for ‘advancement of religion’ under the Charities Act 2013. All organisations that enjoy tax-exempt status should be obliged to demonstrate their activities are in the public benefit. 

We suggest the parliamentary inquiry should consider:

• the removal of the ‘advancement of religion’ from the charity subtypes under the Act;
• or, at the very least, a requirement that religious organisations demonstrate public benefit rather than this being automatically assumed. 

A question of the ‘public benefit’ 

In an ABC Radio Drive interview on 5 April 2021, you noted: “We know that prima facie someone who’s operating a religion is assumed to be delivering public benefit to Australia.”

In this day and age, it is not at all clear that organisations that ‘advance religion’ necessarily contribute benefit to the public. Indeed, many survivors of harm inflicted by religious organisations would argue that some religious organisations do the opposite. 

The tax-free status accorded to church-owned multimillion-dollar commercial enterprises, such as the Seventh-Day Adventist-owed cereal maker Sanitarium, distorts the commercial market and negatively impacts competitors. 

And Sanitarium is not alone. A wide range of businesses – everything from wineries and insurance companies – take advantage of their religious charity status to divert profits to their respective religious institutions.

There is significant cost in lost revenue to the Australian budget that has never been properly accounted for. In the interests of public transparency, it should be. Such enterprises should be subject to the same legal and financial laws as other commercial entities to ensure a fair commercial playing field. 

We do not say that all religious organisations fail to deliver public benefit. Clearly, many do good works and support many Australians in need. But their good works would attract charitable status under heads of charity other than ‘advancement of religion’ – relief of poverty, for example, or advancement of community welfare. 

The RSA supports charity status for organisations that conduct genuine charitable works for the public benefit and in an accountable manner, regardless of whether that organisation be religious or not. We believe this to be the overwhelming view of the public. 

That Sanitarium pays no taxes on Weet-Bix does not pass the pub test. 

Regards,

Dr Meredith Doig

President, Rationalist Society of Australia