Pressure on Vatican to pay tax for 65,000 properties
THE Roman Catholic Church in Italy is under growing pressure to start paying taxes on its massive property portfolio, in a move that could raise up to €800m a year and help bail the country out of its economic crisis.
Campaigners, particularly parties on the centre left, say it is unfair that church-owned properties with a commercial function -- for instance, convents and monasteries that charge guests similar rates to four-star hotels -- are exempt from property tax.
As Mario Monti's government seeks to cut the nation's €1.9 trillion debt, attention is turning to the estimated 65,000 buildings owned by the church. These include 50,000 cathedrals, churches and chapels -- which would retain their tax-free status -- but 11,000 schools, universities and libraries as well as nearly 5,000 hospitals, clinics and other commercial properties that would face the tax.
The Monti administration has said Italians are to be taxed on their primary residences, reinstating a levy abolished by Silvio Berlusconi, who resigned last month.
It is one of a package of tax increases, labour reforms and pension reductions to hit Italians over the next few years. With millions facing austerity, politicians are calling for the wealthy church to play its part. The potential windfall is huge. According to Gruppo RE, an estate agency, a fifth of publicly owned properties in Italy are directly or indirectly controlled by the church.
But calls for church taxes may encounter resistance from the Monti government, which is stacked with academics, bankers and lawyers with strong Catholic credentials.
Under a law adopted in 1982 and supported by an amendment in 2006, church-owned properties are immune from taxation, even those with a commercial element.
But critics say the law contains loopholes. If a church-owned property such as a hotel contains a chapel, for instance, it is spared the tax.
The church has long argued that it should be exempt from the tax because it provides social services through its schools, hospitals and community centres.
However, Tarcisio Bertone, the Vatican's secretary of state, who is second in its hierarchy only to the Pope, said the issue was "a particular problem which needs to be studied", adding that "sacrifices are part of life". (©Daily Telegraph, London)