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How to finance religion?

Summary:
At a time when religious disputes seem to be flaming up again in France, it is worthwhile considering a question that is not so much material as central: how to finance religions, while ensuring the neutrality of public power with regard to different beliefs? In France, we like to give lessons in secularism to the whole world.  It is not here that a president would take an oath on the Bible!  The problem is that this great national narrative is sometimes accompanied by monumental hypocrisy. In reality, there is nothing particularly neutral or exemplary about the system in place in France. Thus places of worship are not officially subsidised, except when they were built before the 1905 law. In practice this applies almost exclusively to  Christian churches. And so much the worse if the

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At a time when religious disputes seem to be flaming up again in France, it is worthwhile considering a question that is not so much material as central: how to finance religions, while ensuring the neutrality of public power with regard to different beliefs?

In France, we like to give lessons in secularism to the whole world.  It is not here that a president would take an oath on the Bible!  The problem is that this great national narrative is sometimes accompanied by monumental hypocrisy. In reality, there is nothing particularly neutral or exemplary about the system in place in France.

Thus places of worship are not officially subsidised, except when they were built before the 1905 law. In practice this applies almost exclusively to  Christian churches. And so much the worse if the map of religious practice has changed since then, and if mosques and Muslim believers meet in cellars and basements.  Similarly, the Catholic denominational schools, colleges and high schools in place at the time of the vote of the Debré law (1959) continue to be massively financed by the taxpayer, in proportions which are found practically nowhere else. These schools have also retained the right to choose their pupils freely, without respecting any common rules in terms of social mix. They contribute powerfully to school avoidance and ghettoisation. France is also the only country to have chosen to close its primary schools one day a week (Thursdays from 1882 to 1972, then Wednesdays) to give catechism lessons. This day was on the way to finally being reintegrated into normal school time, but the current government decided to perpetuate this French exception based on fragmented weeks and excessively long days, despite the proven harmful effects.

With regard to the financing of cults (priests and buildings), the central and little-known role played by tax subsidies must be recalled. If you make a donation to the Eglise de France or the Paris Mosque, you will receive a tax reduction equal to 66% of your donation. In other words, a donation of 100 euros only costs you 34 euros (if you are taxable), and the remaining 66 euros are paid by the rest of taxpayers, as is the case for donations to associations of general interest (cultural, humanitarian, health, education, etc.).

One of the points currently under discussion is whether religious associations can also receive donations and legacies free of inheritance tax and operate rental properties. The question is important and deserves to be clarified. However, it should not obscure the fact that religious associations, whether under the law of 1901 (mixed, religious and cultural associations) or the law of 1905 (wholly religious associations), already benefit from a tax subsidy for income tax purposes. Rather than repeating over and over again that the Republic does not subsidise any religion, which is obviously false, it would be better to face reality and try to improve it.

The problem here is that this system is extremely unequal. On the one hand, it only concerns taxpayers liable for income tax: believers who belong to the poorest half of the population are requested to pay their donation themselves. On the other hand, the higher the donation the believer can afford to make, the larger the public subsidy (up to 20% of income).

The same is true of the systems in place in Italy, where each taxpayer can allocate a fraction of his or her taxes to the religion of their choice, or in Germany, where the mechanism takes the form of a tax supplement collected for the benefit of religions. In both cases there is a bias in favour of religions with a unified national organisation (which in practice excludes the Muslim religion). In comparison, the French model of treating religious associations in the same way as other associations is in some respects more satisfactory. This amounts to considering religion as a belief or a cause like any other and favours the renewal and diversity of structures.

However, this is only possible if the system is made more egalitarian. In concrete terms, public subsidies linked to income tax reductions for donations to associations total 1.5 billion euros per year (including around 200 million euros for religious associations, mainly in favour of the Catholic Church, which has more wealthy donors). This represents an average expenditure of €30 for each of the 50 million adults resident in France. It even reaches 50 euros per adult if one includes tax reductions for IFI (wealth tax) and corporate tax donations. Rather than concentrating these sums on the better-off, one could imagine that everyone would have the same 50 euro « voucher for associative life » to devote to the association of their choice (religious, cultural, humanitarian…), whatever their values and beliefs.

Instead, the government favours suspicion and stigmatisation. Reinforcing the obligations of church associations in terms of transparency and governance is not a bad thing in itself, provided that the scope of funding is broadened and the debate is opened up to all associations. These should include, for example, political parties, which also benefit from subsidies, but which are often opaque and undemocratic. Let us hope that the parliamentary debate will enable us to move away from invectives and promote open and egalitarian secularism.

Sources used in this article :

(1) On the proposal for « voucher for associative life » (« bon pour l’égalité associative »), see J. Cagé, Libres et égaux en voix, Fayard 2020. On the various systmps to fund religions, see J. Cagé, Le prix de la démocratie, Fayard 2018, p.77-78 (The price of democracy, HUP, 2020), and F. Messner, Public funding of religions in Europe, Ashgate, 2015.

(2) On the distribution of gifts and the share of religious associations in the total of gifs and of tax subsidies (share which can be estimated at about 15%), see  Panorama national des générosités (2018). See especially p.35, figure 22-23, and p.44-45.

(3) On the evolution of the system of tax subsdies to gifts in France since 1954, see G. Fack, C. Landais, A. Myczkpowski, Biens publics, charité privée, Cepremap, 2018, p.71-76

(4) See also the  Projet de loi confortant le respect des principes de la République submitted to the Assemblée Nationale on 9 December 2020 (especially articles 7-12 and 26-32).

Thomas Piketty
Thomas Piketty (7 May 1971) is a French economist who works on wealth and income inequality. He is a professor (directeur d'études) at the École des hautes études en sciences sociales (EHESS), associate chair at the Paris School of Economics and Centennial professor at the London School of Economics new International Inequalities Institute.

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