How the government underwrites the church


The Purple Economy — supernatural charities, tax & the state

By Max Wallace

The Australian National Secular Association

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Most Australians who think about the subject will probably tell you that church and state are separate and should remain so.

A new book, The Purple Economy builds a strong case for questioning whether our laws, administrative practices and even our constitution separate the church and the state at all.

Max Wallace has made a valiant attempt to rejuvenate debate on the subject at a time when debate in this country is unquestionably unfashionable.

Wallace defines "the purple economy" as the wealth generated by the tax exemptions enjoyed by religious bodies, referred to by him as "supernatural charities".

His very thorough research has uncovered a huge array of favourable government and judicial decisions which have allowed churches and their subsidiaries to accumulate huge wealth in Australia.

Under these lurks, churches are able to accumulate assets of immense value even at a time when the numbers in their congregations are falling markedly.

Wallace persuasively mounts the argument that secular taxpayers are paying higher taxes than necessary because supernatural charities are allowed to generate enormous profits and avoid paying tax on the grounds that they are a charity.

Wallace queries why the Goods and Services Tax was allegedly introduced partly to capture lost revenue in the black market, when governments are willingly surrendering stupendous amounts of lost revenue through the purple economy.

"Governments have too many demands on their budgets to justify the unqualified continuation of the largesse supernatural charities receive", he argues.

Wallace calls for the federal government to institute a "charities commission" to oversee the operation and administration of charities. This follows several cases of maladministration and misappropriation. Not surprisingly, the Catholic Church opposes such a move.

Wallace explains the way the Vatican has instituted a global strategy whereby its national churches are treated as discreet entities, broken down into many sub-entities which seek as much government subsidy and taxation advantage as possible. This is how many Catholic parishes in the United States have been able to declare voluntary bankruptcy to avoid paying out for paedophilia claims.

The Purple Economy is a timely injection into the republic debate. Wallace argues that an inviolable separation of church and state is a necessary precondition to the formation of a republic.

When I authored a paper on state aid to the Catholic Church in the form of government grants to private schools, I fielded many requests and enquiries about other religious organisations and the extent of their take of taxpayers' funds. Wallace has produced a comprehensive summary, and more. He demonstrates how state aid to church schools is a violation of the interests of the secular state.

He also demonstrates that churches are benefiting enormously from a transfer of public money by government decisions in other spheres.

Wallace also argues persuasively that the move to fund Catholic schools in Australia and New Zealand in the 1960s in fact originated in the Vatican, rather than — as the local media had us believe — via a locally-driven campaign based on need.

The Purple Economy presents a compelling case for the abolition of the anomalies and anachronisms which have been allowed to creep into Australia's taxation and disbursements regime.

The task now is to bring on a vigorous debate on the subject.

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