How can a Church Theologically Justify not Paying Taxes?

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The church is the people, not the building or institution or (in the US) 501c3 organization.

The people have already paid their income taxes if they are obeying Jesus in Luke 20:19-26.

Some give to the church as a percentage of gross income and some as a percentage of net income. Either way, if they are counting gross/net income, they are concerned with taxes as the people of God, and concerned with God's kingdom as those who give to the church.

Just as God commanded the Israelites to support the building and maintenance of the tabernacle/temple, the Levites and the service of the temple through their tithes and offerings, we give to the church to support the infrastructure of the church, the service performed there and the well-being of those who serve on the church payroll. It is not to be a profitable endeavor, in which someone is getting rich off of the people. That would be sin according to Titus 1:7,8:

For an overseer, as God's steward, must be above reproach. He must not be arrogant or quick-tempered or a drunkard or violent or greedy for gain, but hospitable, a lover of good, self-controlled, upright, holy, and disciplined.

This is in contrast to false teachers who were "upsetting whole families by teaching for shameful gain what they ought not to teach." (Titus 1:11)

If the church were a for-profit endeavor, that would also be against the laws which enable it to forgo paying taxes. If it could be shown that the church was intentionally operating for the profit of certain individuals who operate it, rather than for the benefit of the collective body that makes up the organization, then it would not fit the US government's definition of a 501c3 organization. In that case, there is no excuse for not paying taxes and working "to hoard their wealth, and to view it as God's property" as you asserted.

Jesus only required that they pay what was asked of them, both in your example, and also in Matthew 17:24-27, where he provided a tax for Peter and himself from the mouth of a fish.

As the US government has established 501c3 tax laws, exempting both the church and other non-profits from paying taxes, I fail to see how there is a theological problem.

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There are four issues here.

  1. The taxing of the individuals in the congregation.

  2. The taxes payable on a building.

  3. The taxes payable by persons receiving remuneration from the congregation.

  4. The 'enterprise' aspect.

In the UK there have been decisions made about these matters, one of which is a public matter and one of which I am personally aware of because of action taken by the Inland Revenue, privately.

Jesus was in a special position since he was, by birthright, the king of Israel and was not liable to pay tax to anybody. 'Then are the children free', Matthew 17:26, may be interpreted as meaning his heritage as a son of David exempted him (and his immediate 'court' of helper disciples) from liability of revenue.

But when that situation was queried, the Lord made provision for Peter and for himself through Peter's usual occupation - fishing - but in a providential manner, the provision of a coin in the mouth of a fish.

As to the congregation, they earn a living and pay taxes and there is little that can be argued against that. I don't know of any theological arguments against paying income tax, as such.

As to the building, in the UK there has been a case where congregations accepted a tax-free status on their building as a 'place of worship' but then, theologically, did not allow the public access. This was queried and so this particular group allow supervised, minimal access to individuals and, at the moment, are still permitted tax-free status on the building.

Some argue, theologically, that congregations give 'gifts' to ministers and so the ministers should not, they say, pay any tax on 'voluntary gifts'. I know that the Inland Revenue has disagreed with that idea in the UK and has (privately) made it very clear that it will be penalised.

The Inland Revenue, in the UK, regard ministering as an occupation and any remuneration from it is regarded, by the Revenue, as 'earned income' and is taxable.

As to the 'enterprise' aspect, congregations contribute corporate money and that money is expected to be for charitable benefit to others, either for spiritual needs or material needs.

If that enterprise is genuinely charitable then there is little argument that it is not taxable and, in the UK, the church would have charitable status and pay no tax.

But if it were discovered that any individual was benefiting from contributed money or contributed/invested money (other than for the alleviation of suffering or poverty) then that financial benefit would become taxable and I can think of no theological argument that would prevail against lawful taxation of that benefiting individual.

Judas, of course, had the bag and stole from the contributions which were intended for the provision of the disciples (who gave themselves to the work and earned no income) and for the alleviation of the poor.

Thus Judas was stealing not only from those who gave such money, he was stealing from those who should have benefited from those gifts and he was stealing from the authorities since he was forcibly taking a salary and paying no tax on it.

There is no theological argument could possibly condone such behaviour.

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