Island Life by David Slack

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Island Life: The World Is Full of Cu*ts

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  • Matthew Poole,

    Craig, I'd be one of the last to advocate for a state religion, and precisely for the reasons that you give. But for many of those who would like to see the removal of charity status from religious organisations, that view comes about because they would rather that religion didn't exist at all. You, of all people, will understand what I mean when I talk of the intricate intertwining of the spiritual and charitable aspects of the major churches, and my hesitation to remove the religious charity status because of the inevitable negative effects on the "real" charity work that is carried out.

    Auckland • Since Mar 2007 • 4097 posts Report Reply

  • Just thinking,

    The real problem of being in a company doing good (Gods) work, are the labour relations. It's huge leverage to have over your employees or they take that weight on themselves.

    Sallys & secular social workers are doing Gods/good work, for little finacial benefit & often at the expense of their own families wellbeing

    I see Social Work and Councilling as the secular imbodiment of ministry and reconcilliation (confession).

    Putaringamotu • Since Apr 2009 • 1158 posts Report Reply

  • Joe Wylie,

    I would put money on there being a significant decrease in the charitable activities of religiously-affiliated organisations due to the resultant impact on donations.

    Interesting point. Even in this supposed agnostic/atheist hotbed, though, the tone of discussion strikes me as being much more thoughtful and nuanced than one would expect from "hordes" of straw people. Nobody's advocating renouncing Weetbix in response to Bishop Brian's latest antics.

    flat earth • Since Jan 2007 • 4593 posts Report Reply

  • Matthew Poole,

    What bothers him is that – despite undiminishing poverty and growing secularisation – many churches and religious groups sit on a largely undisclosed stash of property holdings, investment funds and trading revenues as part of a valuable portfolio made all the more valuable by their tax-exempt status as charitable organisations.

    And if the charity status for religion was removed, who would benefit? The state? Maybe in terms of some increase in gross income tax receipts, but as a net effect probably not because the charitable works of the churches in alleviating poverty and maintaining churches that have heritage status would be affected. The state is relieved of a lot of poverty-relief work by the activities of church-affiliated charities, and those charities would be seriously affected by the need to restructure asset portfolios and a reduction in donations if the over-arching charitable status of religion was removed.

    Auckland • Since Mar 2007 • 4097 posts Report Reply

  • Craig Ranapia,

    Craig, I'd be one of the last to advocate for a state religion, and precisely for the reasons that you give.

    Certainly not, Matthew, and I hope I made it quite clear that I was riding a train of thought and not slapping around a straw person with your name on it. There certainly are folks out there who will try a Derailing for Dummies trick on discussions like this: You're an anti-religion bigot, therefore you're arguing in bad faith and I don't have to listen any more. You're not one of them.

    I probably don't say this as often as I should: I don't totally agree, but totally respect your thoughtful and reasoned contribution to a useful discussion.

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • Just thinking,

    If I may, we had a State Religion and it still maintains a de facto status in New Zealand.

    To add to Matthews point. Much of the Church land holdings were gifted to the Church and as such have no resale value, as they would need to be returned to the desendants of the original owners. These lands having heritage status and would be not be able to be developed, but would have rates/taxes applying to them.

    A valid arguement for a change to rates calculation of collective Maori land.

    Putaringamotu • Since Apr 2009 • 1158 posts Report Reply

  • Craig Ranapia,

    If I may, we had a State Religion and it still maintains a de facto status in New Zealand.

    Certainly, in the sense that our head of state has to meet a three centuries old religious qualification imposed by the British Parliament (and bears the title Supreme Governor of the Church of England), which is obnoxious and would be flat out unlawful if applied to our legislature, judiciary or civil service.

    But I'd also note we have a Prime Minister of Jewish descent, his predecessor is a professed atheist, and his deputy is a Papist. :)

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • 3410,

    So even if Sanitarium Australia doesn't have to pay federal income or profit taxes as a wholly-owned religious company, that does not apply to NZ.

    Are you sure about that? The above-cited Listener article seems to indicate (though it's not really explicit) that that is not the case (page 2.) I also remember a TV piece about the same time.

    Auckland • Since Jan 2007 • 2618 posts Report Reply

  • Just thinking,

    Anyone know why Tony Blair converted to Catholicism?

    I'm always a little surprised when Anglicans do this (I can't tell the difference myself) and the converts seem to fit into two very different camps.

    Putaringamotu • Since Apr 2009 • 1158 posts Report Reply

  • Matthew Poole,

    Are you sure about that? The above-cited Listener article seems to indicate (though it's not really explicit) that that is not the case (page 2.) I also remember a TV piece about the same time.

    I am absolutely certain that being owned by a church does not exempt a company from paying income tax in NZ. The ways to run a business within the auspices of a church are to create a trading trust or a partnership, neither of which structures are really suited to a massive industrial enterprise.
    I could be wrong, and Sanitarium NZ could be a trading trust and thus exempt from income tax on the basis of its trust holdings, but from what I know of trust management that would be an enormous undertaking. I guess, though, that when you're talking about the tax on so much money it could be worth accepting the limitations and paying advisers just to make it work. In which case, yes, Sanitarium would indeed be running as a totally tax-free operation.

    My caveats are based on literal interpretation of the word "company" in the discussion of Sanitarium Australia. "Company" is a word with particular legal meaning, and if it's being misused then that throws my prognostications out the window.

    Auckland • Since Mar 2007 • 4097 posts Report Reply

  • Matthew Poole,

    Certainly not, Matthew, and I hope I made it quite clear that I was riding a train of thought and not slapping around a straw person with your name on it.

    Yes, I realised that but probably wasn't quite clear enough that I was arguing with you, not against you.
    And similarly I do greatly respect your opinion, even if I do sometimes wish that I could (and am glad that I can't) reach through the monitor and strangle you :)

    Auckland • Since Mar 2007 • 4097 posts Report Reply

  • Paul Litterick,

    ...I could be wrong, and Sanitarium NZ could be a trading trust and thus exempt from income tax on the basis of its trust holdings..

    That you could. I think you might find that Sanitarium in NZ is independent of Sanitarium in AUS, that it is a corporation and is taxed accordingly and that its only connexion with charitable status is the proportion of its profits that it donates to charities.

    Notice too, how I managed to say that without being abusive.

    Auckland • Since Nov 2006 • 1000 posts Report Reply

  • AllanM,

    <Quote>I think you might find that Sanitarium in NZ is independent of Sanitarium in AUS, that it is a corporation and is taxed accordingly and that its only connexion with charitable status is the proportion of its profits that it donates to charities</Quote>
    And if the Sanitarium company donates all its net profit before tax, then it is able to claim a deduction for that donation.
    http://www.ird.govt.nz/business-income-tax/paying-tax/rebates/bit-rebates.html
    Adn that would be after any management fees it may pay to the parent companies (be that in Australia, or the US?).

    <Quote>...and Sanitarium NZ could be a trading trust and thus exempt from income tax...</Quote>
    A trading trust is also not exempt from income tax. The trust itself would need to have charitable status, which I doubt it would get if it sells cornflakes.

    Auck • Since Nov 2009 • 10 posts Report Reply

  • Lucy Stewart,

    Anyone know why Tony Blair converted to Catholicism?

    I'm always a little surprised when Anglicans do this (I can't tell the difference myself) and the converts seem to fit into two very different camps.

    One of the most traditional ways the Catholic church acquires converts: his wife is Catholic by upbringing. I assume he found it impolitic to convert while he was still Prime Minister.

    Wellington • Since Nov 2006 • 2105 posts Report Reply

  • Matthew Poole,

    Allan, the quote tag is case-sensitive it seems. And the preview button is your friend :)

    Addressing your points, I didn't mean that a trading trust is automatically tax-exempt, but that if the trust is charitable, and trades, then Sanitarium NZ could have a fully tax-exempt status.

    Regarding donations, that is a good point. I'd not considered that. However, dividend imputation means that the church won't lose out on the income even if it was no longer a charity. Instead the church would be able to utilise imputation credits, previously denied because of the tax-exempt status, and thus get the benefit of 100% of that profit.

    Auckland • Since Mar 2007 • 4097 posts Report Reply

  • Craig Ranapia,

    I assume he found it impolitic to convert while he was still Prime Minister.

    One might think Papist apostasy was the least of his problems. :)

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • Paul Litterick,

    Addressing your points, I didn't mean that a trading trust is automatically tax-exempt, but that if the trust is charitable, and trades, then Sanitarium NZ could have a fully tax-exempt status.

    But it isn't and it doesn't. It is a company, not a charity. It is not owned by the Adventists and it is not part of Sanitarium in Australia.

    Can we now move on?

    Auckland • Since Nov 2006 • 1000 posts Report Reply

  • Matthew Poole,

    Paul, could you provide some proof that it's a company? There's no Sanitarium Limited listed with the Companies Office, or indeed any company with Sanitarium in its name. The Sanitarium NZ website makes no references to the structure that's used.

    Who are you to ask us to move on? Discussion about taxation of various trading structures is directly relevant to this wider issue of charitable status and payment, or otherwise, of income tax. People appear to be interested in the topic.

    Auckland • Since Mar 2007 • 4097 posts Report Reply

  • Kyle Matthews,

    Yes. To the tune of $27k/year per trust. Multiple trusts with identical trustees will get the spidey-senses of IRD investigators going, too, so it's not a particularly easy restriction to get around.

    I thought the tax was based on the giver, not the destination. So you can give away $27K tax free/year, to one or more things. You get taxed on anything over $27K, even if it goes to multiple destinations.

    Since Nov 2006 • 6243 posts Report Reply

  • Geoff Lealand,

    Would be facetious to suggest that churches pay GST on their income? They are providing a service, after all..

    Or maybe I am just feeling a little bitter after paying out $102 in excise fees and GST, to get access to a copy of a UK-published book I contributed a chapter to.

    Screen & Media Studies, U… • Since Oct 2007 • 2560 posts Report Reply

  • Kyle Matthews,

    Because in fact I don't think religion is a Good Thing

    I don't think the law makes such value judgements. Nor should it. The salvation army does good work, but hasn't always had a great public record on 'the gays'. Does that make them not a charity and liable for tax?

    Some of those same community benefits apply to religious groups (communal activity and such) but that's not *because* they're religious; it's more an offshoot. I fail to see why there should be an exemption specifically for religious bodies on the grounds that their religiosity and promulgation thereof is of benefit to the community, when that in and of itself is not necessarily the case.

    That's an argument you could make for any club, some of whom have very limited social benefits.

    Poets attend to my spiritual needs, and yet the state insists that they pay their taxes. Go figure.

    That's the wrong side of the argument. They pay income tax, same as any priest.

    If there was a charity that was a poet's collective that employed a poet or poets, it would be a tax-free charity to give to. No different than a religion.

    I say cancel every tax exemption currently extended to religious organisations, and make them reapply on the basis the portion of their income that goes into supporting their charity activities. Same as any old corporate body

    In order to get a charitable status certificate you do have to apply already. We did it a few months ago, just had to send them a copy of our constitution.

    I think you mean remove 'religious' from the law.

    Groups promoting systems of thought that don't invoke deities, like the National Party, Greenpeace or the Wellington Anarchist Collective don't get charitable status.

    I'd be very surprised if Greenpeace doesn't have charitable status, given that is how they fund much of their work.

    I believe the missionaries were quite fond of land. What with all those delicious untaxed capital gains year on year, I imagine the leveraged income and the rents would be quite sustaining.

    Those are mostly historical assets though, pre-dating gift tax, let alone tax exemption.

    ... unless someone wants to enlighten me as to exactly why Skippy cornflakes are more religious than Kellog's cornflakes, and thus exempt from income tax (which they are.)

    It's a gift tax exemtion, not an income one. And the exemption applies to the giver, not the organisation that receives it.

    It does encourage giving, by not taxing that money so the religion benefits by.... probably about 50%

    Since Nov 2006 • 6243 posts Report Reply

  • Rich of Observationz,

    @Just thinking: NZ has never had an established religion in the way that the Anglican Church is established in England. We are akin to the the rest of the UK, where the CoE isn't the established church.

    Back in Wellington • Since Nov 2006 • 5550 posts Report Reply

  • Rich of Observationz,

    The Greenpeace Education Trust is a charity. Since I can't find any other entries in the register, I assume that the campaigning actions of Greenpeace are not granted charitable status. (You don't need to be a registered charity to engage in chugging).

    I think my point stands that organisations that promote a deist ideology receive charitable status, while other advocacy organisations do not.

    That's my main objection to giving churches a tax break (even if the effect of that break is negligible). I don't quite go all the way with Denis Diderot "Man will never be free until the last king is strangled with the entrails of the last priest", but believe that, in current society, religious practice should be permitted but not privileged.

    Back in Wellington • Since Nov 2006 • 5550 posts Report Reply

  • Just thinking,

    RoO, I beg to differ. The King James Bible was standard issue at all State Schools, Army Recriuting offices, Law Courts. The West Coast TF office used a Collins Dictionary for years, they just took the cover off, but the intent was clear. FYI the oath is shorter than the affirmation, hence alot more swear into the NZDF.

    Putaringamotu • Since Apr 2009 • 1158 posts Report Reply

  • Matthew Poole,

    Yes. To the tune of $27k/year per trust. Multiple trusts with identical trustees will get the spidey-senses of IRD investigators going, too, so it's not a particularly easy restriction to get around.

    I thought the tax was based on the giver, not the destination. So you can give away $27K tax free/year, to one or more things. You get taxed on anything over $27K, even if it goes to multiple destinations.

    Yes, you're correct, and that does mesh with what I said. The point to which I was responding was about trusts giving to beneficiaries, tax-free. What I said, though possibly not quite sufficiently clearly, was that a trust can give up to $27k/year. My additional note was to anyone who was thinking that Pope Brian could just set up a bunch of trusts, funnel funds through them all, and get around the $27k limit by having multiple trusts making payments to the same pool of beneficiaries - his family.

    Auckland • Since Mar 2007 • 4097 posts Report Reply

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