The fat is now in the fire. A group has taken the Catholic Church into Federal court to protest its tax exemption. The reason? The Church has taken a public stand against abortion. The abortion issue is political, and therefore involves legislation, the plaintiffs assert. The Internal Revenue Code says that tax-exempt organizations that are involved in political lobbying must lose their tax-exempt status. Therefore . . .
A district court denied the claim, and the case has been appealed to the U. S. Supreme Court. The Court has decided to hear it. The justices will probably do their best to find some way to decide the case on narrow technical grounds in favor of the Church. The political repercussions of removing the Church’s tax-exempt status would be immense. It is unlikely that the Court will require this. But then how will the Court uphold the IRS principle of allowing tax exemption only for non-political (non-lobbying) organizations? The Court has a real problem.
There is no doubt that some priests have preached from the pulpit that abortion violates the law of God and is therefore immoral. There is no doubt that the Church has been active in trying to get legal limits placed on abortions. The Catholic Church is identified with the anti-abortion issue, even though not many of its parish priests have been active in the right-to-life movement. (if Catholics voted as a bloc on this issue, and consistently voted against all incumbent politicians who publicly compromised on this issue, abortion would no longer be a major political issue in the U. S.; it would be made illegal.)
The Court must deal with a fundamental constitutional question. It must find a solution to the question: is the tax exemption of churches sacrosanct — a sacred sanctuary — or is it merely a privilege granted by the IRS to those churches that conform their preaching and activities to guidelines in the Internal Revenue Code? Ultimately, this is the issue the Court must deal with: Which is the sovereign agent, church or State, or are both equally sovereign? Legal sovereignty in this case is visibly manifested in an institution’s legal ability to escape taxation. The church clearly cannot legally tax the State. Can the State legally tax the church? This issue has been debated for centuries in the West, and the issue has obviously not yet been settled.
Taxation and Sovereignty
“The power to tax is the power to destroy.” So said Chief Justice John Marshall in his famous decision in the case, M’Culloch v. Maryland (1819). The state of Maryland had imposed a tax on all bank notes issued by banks not chartered by the state of Maryland. M’Culloch, the cashier of the branch Bank of the United States in Baltimore, refused to pay the tax. Two legal questions were involved:
First, did the U. S. government have the right to charter a private bank? Second, was a state tax on such a bank constitutional?
This post was published at Gary North on February 04, 2016.
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