Devon Dick | Church and property taxes
On Saturday, I was asked by a reporter about the church and property taxes. It is suggested that the church should pay property taxes in order to close the gap in the country's budget. I asked how much would be collected for the coffers from such a move but the reporter had no data.
There is data on tax exemptions to the church to be found in the 2004 revised edition of my book, Rebellion to Riot: the Jamaican Church in Nation Building which states that under the General Consumption (GCT) Act the 1995-99 record under the 'Places of Worship' concession code 5000, "the church received exemptions valued at J$10.52 million but this does not include the other exemptions that can be granted by ministerial order of the Minister of finance, which valued J$100m in 1999. These exemptions were granted to cover taxes on cars, musical instruments, refrigerators, public address systems and other effects that facilitate worship". This is not an enormous amount of money when compared to exemptions given to the police, civil servants, parliamentarians, senators and custodies. Furthermore, this data is not in relation to property taxes. Finally, persons in the employ of churches pay income tax.
In the 1980s, section 10 of the Property Tax Act was amended to provide for a tax exemption for all church-owned buildings such as chapels, rectories, caretaker's cottages, school rooms or church halls along with the lands immediately attached to them, provided that area does not exceed one acre. This Act clearly tells that the church pays property taxes on some properties such as its headquarters and properties above one acre. Let's say, for example, the church now gets exemption of property taxes on cemeteries. If property taxes were levied on cemeteries it would mean that churches would have to start charging for a burial spot or increase the charge to be buried on church property.
I argued that based on the historic contribution of the church in the areas of the establishment of free villages, building societies, credit unions, and schools, a tax exemption can be justified. In addition, based on the continued contribution of the church in areas such as educational scholarships, skills training, dental clinics, medical clinics, homes for persons who are aged and disabled a case can be made for the church to receive exemption from paying property taxes.
Additionally, there are groups that get tax concessions - for example when the sugar factories were divested to a Chinese company, concessions were granted. The hotel sector and the two main political parties get tax exemptions. However, the church would have to pay property taxes if the government institutes a general policy of no exemptions.
The reporter also asked what ideas I had to raise taxes if the government did not remove the exemptions of property taxes of churches. I suggested a visa regime for non-Caribbean visitors. The USA, Canada and UK make billions of dollars from a visa regime which has no co-relation to the administrative cost of producing visas. Small countries such as Cayman Islands and Turks and Caicos islands have a visa regime for Jamaicans to enter their countries. So, if we charge our one million visitors US$100 per visitor for a visa then we would raise US$100 million every year. Even if it were to charge US$50 per visa it would amount to US$50 million. This can be collected online or at the ports of entry.
All persons agree that Jamaicans are over-taxed, therefore, the discussion on a tax regime change should not be designed to tax Jamaicans more but to get taxes from our visitors.
- Rev Devon Dick is pastor of the Boulevard Baptist Church in St Andrew. He is author of 'The Cross and the Machete', and 'Rebellion to Riot'. Send feedback to columns@ gleanerjm.com.