It is conspicuous the fact that the community thread is woven with threads of beliefs, morals, traditions and ethics. The topic is considered sensitive to the policy maker. In my opinion, the country must reassess her position on revenue generation from the church.
Firstly, the Christian faith does not preach an automatic exemption of tax burden on the Church. From a lay understanding of Luke 20 verse 19 to 26 for instance, Jesus Christ is seen to have affirmed the legality of taxes imposed on the Church. The gates are therefore open for a further discussion on the imposition or not of a tax liability.
Currently, Churches enjoy exemption from payment of taxes on all revenue generated in the course of its business. The motive behind this exemption is sound. The Ghanaian society is built around religious underpinnings especially that of the church, relieving the church from any burden to discharge its duties has never been a bad idea morally.
Legally, through the lenses of the public interest, exemption of taxes for education institutions, health centers and religious bodies are always welcoming. Exemption of taxes for churches in the interest of the public in my opinion begs the question.
Yesteryears churches adopted for themselves the responsibility of setting up social and developmental structures. The evidence of their legacy are mainly schools and hospitals spread across the nation. Notable mentions are Adisadel College, Aggrey Memorial School, St. Peters Senior High and so on. Considering the fact that they adopted responsibilities reserved mainly for the central government, the tax exemption was a good call. In my opinion, it was to serve as an incentive to boost their developmental motives.
The profit-targeting methods adopted by today’s churches make nonsense of the motive behind the exemption foretasted. The sale of goods and services in the assembly has become rife. Juxtaposing to developmental structures, there have been a sharp decline in projects embarked upon by the churches.
This is notwithstanding the fact that the number of churches has increased in multiples.
To wit, we erroneously expected an increase in projects by the soaring number of churches. In the absence of such help, the government is burdened with providing such amenities. There is therefore no need to maintain the kind gesture.
It is hypocritical in my opinion to waive taxes on goods sold in Churches which are subject to taxes on the market. That in itself creates a systematic avenue for tax avoidance. The markets in the Church are monopolistic and unregulated. Prices are set to appeal to faith and belief. Cheap goods can be expensively priced. More gains are made from a basket of goods sold in the church compared to open market activity. Contribution of members results in the unjust enrichment of the church.
Ghana adopts a progressive system of tax. The system is fixed to redistribute revenue from the rich to the poor. More taxes are raised from the rich to provide social amenities for the benefit of all persons. A
good progressive tax base targets the wealthy faction in the society to raise more revenue. A system which exempts a lucrative source is therefore questionable.
Unlike the open market, the church can effectively predict their gains from sales using records of registered members. The church system works through members contributing into a single pot. The church falls within the rich faction in the society. The tax system must therefore target the profits made in the church.
It is therefore my position that there is the need to revisit the tax exemption granted to the church. There must be a fission between monies used to help national development and profit-making schemes. A tax is a loan postponed; either Ghana fixes taxes to develop the nation or suffer our future generation to pay the principal plus interest of today’s loans. Give to Caesar what belongs to Caesar.
Nana Kwaku Boadu-Boadu
Msc Economic Analysis Candidate at the Corvinus Egyetem Budapesti