Gov’t finally gets serious about taxing the clergy

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Gov’t finally gets serious about taxing the clergy

Starting next year any regular religious donations that are used by the clergy for living expenses, education, medical expenses and even spiritual training will be taxed by the government.

However, irregular donations such as payments for officiating at a wedding or funeral or giving a school lecture will be exempted.

The Korean government is considering applying income tax on pastors, clergy and monks but it will allow some special deductions.

The Ministry of Strategy and Finance has drafted standard for taxing religious earnings for the first time.

The Finance Ministry on Monday said it distributed the guidelines to religious organizations between Sept. 7 and 8.

The Ministry said it will canvass opinions of the religious community before coming up with a finalized version next month.

The biggest questions was to choose which payments should be taxed. Clergy don’t have a clear definition of their incomes. The government decided to tax any payments that occur with regularity.

“Nothing is conclusive as we are still in the stage of collecting opinions of the religious organizations,” said a Finance Ministry official. “The details will be out by the end of next month.”

One plan includes taxing residential expenses if the clergyman is supported by cash. However, if the apartment or house that the clergyman is living in is owned by the religious organization or leased, it will be exempted.

Additionally, while a 6 to 40 percent tax rate will be applied as on other workers, the clergy will be eligible for deductions from 20 percent to 80 percent depending on the size of their annual incomes.

Those that will be given a 80 percent deduction on their taxable income will be clergy whose incomes are 20 million won ($17,740) or less.

Taxing the clergy has been a major issue for decades but no government has succeeded.

There has been strong opposition from political circles led by Kim Jin-pyo, the Democratic Party lawmaker who led the de facto transition team for the Moon Jae-in administration. Kim has repeatedly requested extending the grace period so that there could be better preparation made.

However, with a two-year grace period coming to an end, the Moon Jae-in government has decided to implement Korea’s first church tax.

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