Ministry poised to tax religious groups

Religious leaders prefer voluntary payment to binding income taxes


The Ministry of Strategy and Finance is poised to propose a bill on the taxation of religious groups as part of the 2012 Tax Law amendment to be made on Aug. 8.

Aimed at ensuring the equal application of income taxes, the bill would impose income tax on Korean religious societies that have been exempt since the nation’s foundation.

According to ministry officials, the bill will be included either in this year’s revision of the Tax Law or its sub-regulations. Religious groups are currently excluded from tax due to their status as non-profit charity organizations.

How to match the income of religious groups to different income brackets still remains vague, with the government hoping to settle the matter through discussion.

The move comes after Finance Minister Bahk Jae-wan announced the launch of a committee composed of government officials and representatives of religious groups to hear and discuss details.

“As the first step, we will start a committee with religious group members to talk over general changes expected from the taxation (on religious groups),” the minister said during a press interview on May 29.

“If the launching of the committee faces obstacles (due to protests from religious organizations), we are ready to make visits and listen to what they have to say.”

Unlike public concerns, religious societies generally tend to embrace the new taxation move as individual constituents of the country.

Leaders of the nation’s five major religions ― Buddhism, Christianity, Catholicism, Won Buddhism and Chondogyo ― are said to have attended a conference presided by the Finance Ministry director of taxation policy that was held in private on June 20.

Multiple religious leaders said during the conference that the representatives of religious groups reached a consensus on paying income tax.

The religious leaders added, however, that the government should let them “voluntarily pay the tax rather than enforce it.” They also came out against the government’s setting of specific dates for the tax payment.

Other requests of the religious leaders included: clarified definition of taxation glossaries, new establishment of “religious tax” rather than applying previous income tax to religious servants, and government-provided copies of guidelines for the new tax.

Some vernacular news media reported that taxing the religious would not require a separate “religious tax” system because, in constitutional terms, these groups are not exempt from income tax.

Whether the new tax bill involves compulsory tax or voluntary tax is likely to become a major source of dispute regarding the issue.

By Chung Joo-won (joowonc@heraldcorp.com)