We’ve heard a lot recently from the Vatican on the “social justice” front, most of it the usual leftish sanctimony garnished with the distaste for the free market that has long been an important strand of Roman Catholic thought.

Well, now comes an excellent opportunity for the church to back up its words. The Daily Telegraph has the details:

The Roman Catholic Church in Italy is under growing pressure to start paying taxes on its massive property portfolio, in a move that could raise up to 800 million euros (£680 million) a year and help bail the country out of its economic crisis.

Campaigners, most prominently parties on the centre left, say it is deeply unfair that Church-owned properties with a commercial function — for instance convents and monasteries that charge paying guests similar rates to four-star hotels — are exempt from property tax. As the new technocrat government of Mario Monti seeks to slash the nation’s 1.9 trillion euro debt, attention is turning to the estimated 65,000 buildings owned by the Church.

They include around 50,000 cathedrals, churches and chapels — which would retain their tax-free status — but 11,000 schools, universities and libraries as well as nearly 5,000 hospitals, clinics and other commercial properties would face the tax.
The Monti administration has announced that Italians are to be taxed on their primary residences, reinstating a levy that had been abolished by Silvio Berlusconi, who resigned from his third term in office last month.

It is one of a package of tax increases, labour reforms and pension reductions which will hit Italians hard in the pocket over the next few years. With millions of people facing a bleak era of austerity, politicians are now calling for the enormously rich Church to play its part in shouldering the burden. The potential windfall is enormous. According to an estate agency, Gruppo RE, a fifth of publicly owned properties in Italy are directly or indirectly controlled by the Church.

But calls for Church taxes may encounter resistance from the Monti government, which is heavily stacked with academics, bankers and lawyers with strong Catholic credentials. Under a law adopted in 1982 and backed up by an amendment in 2006, Church-owned properties are immune from taxation, even those that have a commercial element.

This will be a good test of both Monti and the Catholic Church. Serious or not?

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4 Responses to Well?

  1. Gerard Mason says:

    I’d be more impressed by your post if it didn’t continue the elementary blunder made by the original Telegraph article, which is to assume that the Italian state will make best use of the money. As a right-of-centre thinker, I hope that you’d be likely to argue against that idea in most other contexts.

    Indeed the Italian state, despite being funded by taxes (that is to say, by coercion), is now nearly bankrupt. The Catholic Church on the other hand is funded for the most part by voluntary donations, and yet you are complaining because it has managed to grow its assets by careful husbandry over the centuries — and all the while funding its own programmes of expenditure on social causes.

    Those schools, universities, hospitals, clinics and libraries would not exist if they hadn’t been created by the church as part of its mission to educate the unlettered and cure the sick. Yes they make a profit where they can (which, as an economically ‘dry’ person I think is no more than a good and prudent thing) but they also have charitable aspects which make them unlike some other private facilities.

    And what would the state do with any taxes so paid? Well I guess they might use them to fund hospitals, universities, libraries … oh, wait… Ah, but these would be *secular* hospitals, universities, libraries and, dare I say, ‘clinics’ — now I see the attraction! And that’s the best-case scenario; much more likely is that the money simply goes to pay bondholders, or disappears into the black hole of Italian government expenditure.

    Finally, the use of salivatory words like ‘windfall’ is a dead giveaway as to what’s going on here. Other than finding oil in the ground or a bunch of apples under a tree, there is no such thing as a ‘windfall’ — just the coercive transfer of assets from people who knew how to create them to another bunch of people who think, wrongly, that they know how to spend them.

  2. Bob_R says:

    I don’t see anything inherently contradictory with the assertions that (1) high rates of taxation and controls on free market capitalism by government will bring about “social justice” and (2) any money the Italian government takes from the Catholic church will do less to achieve “social justice.” Of course, there are buckets of evidence that the first is false and the second might well be true, but the leaders of the church have been able to simultaneously assert ideas far more in opposition than these for a couple of millennia. They are experts at it.

  3. Narr says:

    This reminds me of an anecdote I read years ago (in The Screwing of the Average Man[?]). Two reporters were going over property records in Manhattan and kept coming across the ownership notation “RCA.” One says, “Man, it looks like RCA owns half the island!” The other one, older and wiser, says “Yeah, they do. RCA stands for Roman Church of America.”

    I’ll bet $10,000 (haha) that taxing of churches will fare less well in Italy than in the USA, and it will NEVER happen here.

  4. Jeeves says:

    According to an estate agency, Gruppo RE, a fifth of publicly owned properties in Italy are directly or indirectly controlled by the Church.

    Publicly owned but controlled by the church? Which are these? The Pitti Palace? The Colosseum? Trevi Fountain? Any number of palazzi? And is there a proposal that these would be subject to a property tax? Based on “control”?

    Odd, given the casual approach of the Italian government to collecting taxes, and the people to paying them, that primary residences should not be taxed before now. Hard to hide a house or a flat, and there has to be some kind of registrar of deeds.

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