This article discusses whether the state can require taxes from the church? It also discusses the relationship between state and church.

Source: Faith in Focus, 2004. 4 pages.

The Charities Bill A Letter Sent by our Political Contacts Committee

June 1, 2004

To the Social Services Select Committee.

Dear honourable Members of Parliament, We represent the Reformed Churches of New Zealand, a Christian denomination with twenty one congregations. Our committee is a standing committee of the Synod of the Reformed Churches. We would like to present this submission in person.

The proposed Charities bill seeks to proscribe the work of the Christian church in ways hitherto unknown in New Zealand. Our primary concern is that this bill introduces a new intrusiveness by the state into the business and prerogative of the church. We will argue that the church should be distinguished from other charities and should not be subject to these proposed regulations. Several key themes need highlighting in an analysis of this proposed legislation.

  • The state has a responsibility to encourage the well-being of the church of the Lord Jesus Christ.
  • The proposed bill endorses the state’s unlawful interference in the role of the church.
  • Church funds spent on overseas missions may be reassessed for taxation purposes.
  • Churches are unique and should not be lumped in with other charities.
  • Other miscellaneous factors.

The State’s Care for the Church🔗

Firstly, the state has a responsibility to encourage the wellbeing of the church of the Lord Jesus Christ. Biblically, the church has no right to govern the state or rule over it in the manner the Roman Catholic Church endeavoured to do for centuries prior to the sixteenth-century Reformation. The Lord Jesus put it like this:

Jesus answered, ‘My kingdom is not of this world. If My kingdom were of this world, then My servants would be fighting so that I would not be handed over to the Jews; but as it is, My kingdom is not of this realm.’John 18:36

It is equally clear that the state has a role, nonetheless, in supporting true religion. The state is indeed to be a “minister for good” to “all”, including the church (Rom. 13:4) and therefore has a benevolent role to play with respect to the church. Christians base this responsibility on prophecies like that found in Isa. 49:23: “Kings will be your guardians, And their princesses your nurses”. Most politicians believe that it is the state’s responsibility to have laws in place that encourage the improvement and advancement of arts, education and various other cultural endeavours. This belief is founded on the idea that these endeavours are beneficial for society, and it is unlikely that our government would deny that they do have an obligation to promote such institutions and endeavours. Since Christianity is a major contributor to the well-being, peace and security of society, civil rulers should likewise seek to support the prosperity of the church, a responsibility long recognised in our culture. While it is true that recent New Zealand governments have increasingly overlooked their obligations in this area (for example, the liberalising of Sunday trading and the like), this does not mean that the obligation has disappeared. We argue that government continues to have a responsibility to see the church prosper in its task of bringing the message of eternal salvation and of Christian ethics to New Zealanders. And it is for this reason that we believe that the state should continue to provide taxation exemption to the entire work of the church. However, we note with some real dismay that this bill may have the opposite effect and lead to government interference in the lawful mandate of the church.

Unlawful Interference🔗

Secondly, therefore, the proposed bill endorses the state’s unlawful interference in the role of the church. The Charities bill seems to operate on a false principle that governments know best and so can impose socialist values on God’s ordained institution, the church. Whereas the church has been required by God to collect offerings as a part of the worship of God (1 Cor. 16:1-2), this bill wants to judge the church’s use of these gifts to God and impose taxation on those gifts and therefore redistribute those freewill offerings of the Lord’s money in ways not envisaged by Him or His church. It is one of the first principles of Scripture that the state has a responsibility towards the church circa sacra, but not in sacra. It is to the church that God has committed the oracles of God and it is to His appointed office bearers that Christ gives the mandate:

Go therefore and make disciples of all the nations, baptizing them in the name of the Father and the Son and the Holy Spirit, teaching them to observe all that I commanded you; and lo, I am with you always, even to the end of the age.Matthew 28:19-20

Ephesians 4:11 is another text that affirms that Christ has committed the teaching function and government of the church to church officials and not the state. Only the church can define its role and how it goes about fulfilling its responsibilities towards God and society. No other body can, therefore, usurp the role of the church in its function in the world, because, quite simply, no other body or individual is competent to decide the mission of the church. This the church herself must decide on the basis of revelation. It is precisely at this juncture where we see the danger of this Charities bill. Clause 15 gives authority to the state to decide who will be an officer of a charitable entity. It is not the state’s proper function to appoint or dismiss official functionaries within the church. While the intent of the legislation is to exclude convicted criminals and the like from operating a charity, the church may conceivably want to appoint someone who has repented of past sin and been restored in the church to a position of responsibility. The authority to appoint officers in the church is delegated to the church by Christ and not to the state, therefore this Erastian idea should have no place in the relationship between church and state in New Zealand. The state will also interfere with the work of the church in other ways if this bill is passed in its present form, for the state is allowed to decide what the role of the church should be in promoting religion. This is obvious from the powers given the commission in clause 26, where the commission can decide what constitutes a charitable purpose. The “general policy statement” in the bill includes in the definition of a charity that it provide a clear public benefit. The state, however, can easily be blinded by prejudice and the tenets of the prevailing religion of secular humanism and decide that the church, on some issue, is not providing a public benefit at all. A church might, for example, consider the promotion of religion to involve the public criticism and denunciation of certain life-styles, such as homosexuality or prostitution, and it is not inconceivable in the present climate that a commission appointed by our current liberal government will take exception to this and thus remove such a church from the register. Furthermore, the commission reserves for itself the right to publish details concerning the charitable entity and therefore potentially release aspects of the work of the church to the public which may compromise that work. The state also reserves the power to punish the church for noncompliance in clauses such as 24 and 58-61. While there is an appeal process, the commission will potentially involve a church in massive and prohibitive legal costs when she is called upon to defend her calling, teaching and function. However, the courts and the state have no lawful authority to proscribe or define the church’s function, especially in the church’s role in criticising sin or moral evil. The church must always reserve the right to proclaim the whole counsel of God (which will often offend those who reject the teaching of the Word of God) or cease to be a faithful church (Acts 20:27).

Not only in New Zealand🔗

Thirdly, church funds spent on overseas missions may be reassessed for taxation purposes. We are pleased that the bill does define a charitable purpose which “includes every charitable purpose, whether it relates to the relief of poverty, the advancement of education or religion, or any other matter beneficial to society” (clause 4:2). The implication of this clause is that the advancement of religion is beneficial to society. However, the clause begins with the caveat that “unless the context requires”, “charitable purposes” refer to the above mentioned activities. The context in clause 31 appears to limit the definition of “charitable purposes” to exclude the “advancement of religion” in certain circumstances. A donee can receive funds for “any charitable, benevolent, philanthropic, or cultural purposes within New Zealand”, which could admittedly cover the advancement of religion. However, it is only in New Zealand. This means that a substantial part of the work of the church, the support of overseas mission organisations and individual missionaries, would be compromised financially, for overseas’ recipients would not be able to qualify as donees. Presumably this would also mean that such monies would be reassessed for taxation purposes and the churches taxed on income used to support overseas’ missions.

Uniqueness of Churches🔗

Fourthly, churches are unique and should not be lumped in with other charities. Gifts to churches are not gifts to men or merely human institutions and organisations as is the case with other charitable agencies. Gifts to churches are rather gifts consecrated immediately to God Himself and are, therefore, His property. To tax the church of the Lord Jesus Christ is effectively to tax God Himself. The church, like the state and the family, is directly instituted by God. The church is also unique by virtue of her task. She is set apart by God to be faithful to Him and to call the world to repent and believe the message of the gospel God has committed to her. Her efforts, therefore, will not be measurable in the way other charities might be evaluated. Often her efforts will produce no obvious fruit and may even invite opposition and persecution. And yet in all of this she is faithful to her unique calling if the Word of God is proclaimed. Her role is not to be limited to giving material help to the poor, but includes giving spiritual help to the spiritually poor, with the far more profound eternal consequences such help implies.

Other Factors🔗

Fifthly, there are other miscellaneous factors that add weight to our contention that this new bill is bad law which will add further distress to the churches of this land.

The bill allows the state to decide what sort of name a charity can use and can deny the privileges of a registered charity to an entity whose name the commission does not like. However, it is not the government’s task to decide beforehand the worth of a Christian ministry or organisation. For example, the government could decide that a title such as the Society against the Promotion of Homosexuality is offensive and so exclude a charity on that basis. This is surely not the government’s prerogative. After all, the name may be important for advertising the function of the charity and fundamental to its purpose.

The bill does not protect the names of unregistered charities from being hijacked by other charities that might even seek to register their charity using the name of a church (this problem would be similar to the internet domain-name debacle).

The use of registration numbers is also a frightening way of manipulating charitable societies, for the state would be guilty of arbitrary discrimination if it approved a charity on the ground that the charitable entity displayed a registration number, while another did not.

There is also an inherent inequity in the bill which allows the commission to indemnify itself against potential liabilities while the officers of the charity are prevented from doing so (clause 66).

The bill also allows for the misuse of information collected from charities. In the Explanatory Note at the beginning of the bill, we read:

Information collected from the registration and annual return forms will also be used to help inform the development of social policy and help the sector to develop a deeper understanding of funding sources and trends. As a consequence, the Government will be in a better position to target policy interventions to areas of the charitable sector where a need for further Government assistance is identified.

State interference and the gleaning of confidential information from charities should not by used by a government to set a policy agenda.

The suggestion by the bill, that registration is “voluntary”, is at the least misleading, because a charity is forced to register if it is to enjoy the tax free status it enjoyed prior to the introduction of this proposed law.

We would add that there are sufficient laws in place to cover fraud and misappropriation of monies and that there is no need for new laws to regulate the function of the church.

Our Request🔗

We therefore advocate and request that the select committee recommend to Parliament that Christian churches continue to retain their tax-free status we have always enjoyed and thus be exempt from the jurisdiction of this proposed legislation, reserving the scope of the bill to other charities external to the church. This we believe would ensure that the state does not stray into an unlawful domination of the church, her mandate and mission.


G. Milne (Convenor)

Members: G. H. de Jonge; J. Haakma; M. Munroe; Rev. E. Rademaker. (Political Contact Committee, Reformed Churches of New Zealand)

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