Struggle between a church and the state
The Sydney Morning Herald
November 21, 2009
Changing Scientology's tax-exempt status could involve a legal stoush, writes Malcolm Knox.
"Scientology is evil; its techniques evil; its practice a serious threat to the community, medically, morally and socially; and its adherents sadly deluded and often mentally ill."
The above statement was not made by Nick Xenophon under the privilege of the Senate this week, but by a Victorian barrister, Kevin Anderson, QC, who had led a two-year government inquiry into the Church of Scientology in the 1960s. Then, as now, former Scientologists alleged that "mind control", physical and emotional abuse, and financial deception were standard practices, not exceptions, and integral to the church's "brainwashing" of its parishioners.
In 1965, following the Anderson report, Scientology was banned in Victoria. But in other states it continued to employ ministers and celebrate marriage, also carrying out charitable and educational work to meet the criteria of a tax-free church. By 1983, it fought the Victorian Commissioner of Payroll Tax up to the High Court, which ruled for Scientology, saying it "had easily discharged the onus of showing that it is religious. The conclusion that it is a religious institution entitled to the tax exemption is irresistible.
Although the decision is repetitively cited by Scientology's spokespeople, the High Court did not assess the church's practices or credibility, merely its claims. As Justice Lionel Murphy said, "Any body which claims to be religious, whose beliefs or practices are a revival of, or resemble, earlier cults, is religious".
Xenophon, carrying letters from former Scientologists, has called for a new inquiry. The Prime Minister, Kevin Rudd, agreed that he and the community had "grave concerns" about the allegations, but he stopped short of backing an inquiry. Senator Xenophon's office has forwarded information to state police departments, and for now it is a police matter; but the senator said that he would continue to press for a public inquiry.
As in the 1960s and in every controversy since, the Scientologists themselves are on the march. The Sydney church's spokesman, Cyrus Brooks, likened Xenophon's accusers to disgruntled former spouses, and sought access to the letters.
Xenophon's speech has galvanised reaction to Scientology's exemption from paying tax. The independent MP Tony Windsor said he supported an investigation into the wider issue of tax-exempt organisations gaining commercial advantage over taxed competitors.
Any new process to change its status, say legal experts, would involve revisiting a section of the constitution that has not been before the High Court since the 1980s. Either a Parliament could legislate an act that withdrew Scientology's religious status, or a state or federal tax department could issue Scientology with a tax notice and challenge it to fight the notice in court.
Associate Professor Beth Gaze, of Melbourne University, who has just completed a report on religious discrimination for the Victorian Government, told the Herald that a law withdrawing Scientology's status as a religion "would not be impeded by anti-discrimination laws". Tax-exempt status, she said, is "a privilege accorded by the state, and if the state wished to roll back that privilege from a particular organisation, then that legislation would prevail over anti-discrimination laws".
Any challenge, then, would lead to section 116 of the constitution, which prohibits the establishment of a single state religion and protects the free expression of religion in Australia.
A Melbourne University professor of constitutional law, Adrienne Stone, said section 116 is so infrequently litigated that it is not known which way the present High Court would lean, but she thought it "unlikely" that the court would strike down a law to remove Scientology's religious status.
"Provided that a wide range of other religions continue to have tax-exempt status, it is probably not 'an establishment' of religion to remove it from one religion (it might be problematic, however, if only one religious group had the exempt status)," she said.
As for the clause of section 116 that frees religious expression, Professor Stone said: "I also think [a removal of the tax exemption] is unlikely to constitute a prohibition on free exercise. That clause would invalidate a Commonwealth law that penalised religious practice or prevented the observance of religious requirements, but the removal of tax-exempt status doesn't do that. There is no case in which the High Court has held that the imposition of a financial burden amounts to a prohibition on free exercise." She added two caveats: one, that section 116 has not been litigated for so long that there is a "paucity" of legal guidance, and two, that Justice Lionel Murphy in a 1981 case said all religions should be treated equally, but "that principle has not so far been recognised by other judges".
John Emerson, a charity taxation specialist at the law firm Freehills, said that "if an investigation shows that the church's activities are not consistent with those exhibited by religious institutions, and if those activities can be shown to have changed since 1983, then it's open for a tax commissioner to run a case against the organisation saying it should no longer be recognised as a church". He said that this avenue would be more popular than an act of Parliament, "which might worry other religions that they could be next".
Disclaimer:This news page is about groups, organizations or movements, which may have been called "cults" and/or "cult-like" in some way, shape or form. But not all groups called either "cults" or "cult-like" are harmful. Instead, they may be benign and generally defined as simply people intensely devoted to a person, place or thing. Therefore, the discussion or mention of a group, organization or person on this page, is not necessarily meant pejoratively. Readers are encouraged to read widely on a topic before forming an opinion. Never accept information from a single source at face value. This website only holds a small amount of information and should not be relied on as a complete source. For example, if you find older information, this should be weighed up against newer information as circumstances can change.