Taxation is the right of the state to collect compulsory payments from individuals or legal entities, if necessary, by coercive means. Taxes must not be used for any purpose that is not defined by law as a public task.
In the U.S., the government is forbidden to levy contributions for churches or other religious bodies. In Germany, religious communities have the right to impose church taxes on their registered members.
For the Catholic Church, the Protestant territorial churches (former state churches) and the Jewish communities, church taxes are the chief source of income.
This means that governmental financial authorities charge members of the entitled denominations with an additional levy, which usually equals 9% of the income tax owed to the state and transfer the money to the churches.
Theologically, this is odd: How can a Christian church claim the right to collect from its members compulsory payments, if necessary, by coercive means?
Historically, the church tax system goes back to a “half-way disestablishment” of the former state churches in 1919.
The system requires that state authorities record the religious affiliations of all citizens who are affiliated with churches or other religious bodies that participate in the church tax system.
The usual practice is that Catholic and Protestant parishes report baptisms to the public registry office.
The entry on church tax liability forms part of the individual’s record and can only be deleted if the person formally quits membership with the taxing religious body.
Members of taxing religious bodies are obliged to reveal their religious affiliation not only to state authorities, but also to their employers and to their banks.
It is not possible to be a member of the Catholic Church or of the Protestant territorial churches without being registered as a church taxpayer.
Currently, 93% of all Christians living in Germany, or 54% of the total population, are affiliated with either the Catholic Church or the Protestant territorial churches.
In spite of ongoing secularization, the church tax system enjoys a high degree of acceptance.
It provides a stable financial basis even in times of declining church membership.
Indeed, the tax revenue yielded by the two major denominations has been steadily increasing during the last decade and totaled 12.1 billion Euros (or nearly $13.8 billion) in 2017.
German free churches – like Baptists, Pentecostals, Congregationalists, Methodists and Adventists – intentionally abstain from their taxation rights and advocate voluntarism in matters of faith, including the voluntariness of financial contributions.
According to some statistics, registered members of the “classical” free church denominations total no more than 0.4% of the German population.
While these figures may be imprecise, it is obvious that free churches represent just a tiny portion of the general public.
Few Germans would share the position that churches should be consistently donation based, and even the free churches do not actively campaign for the abolition of church taxes and other traditional privileges of the two major denominations.
These privileges include that Catholic dioceses and Protestant territorial churches benefit from annually paid state subsidies from the general tax revenue.
These payments are usually justified as compensations for the transformation of ecclesiastical principalities into secular territories in 1803 – one may comment that this justification is difficult to comprehend.
Germany is a federal republic consisting of 16 states, and the situation differs in each state.
While two states pay no direct contributions to the churches, the 14 other states supported the two major churches with 538 million Euros (or $611.4 million) in 2018.
For most dioceses and territorial churches, the direct subsidies – to which all taxpaying citizens, regardless of their religious affiliation, must contribute – are no substantial source of income, but in some cases they actually are.
One such case is the Evangelical Church in Central Germany, the territorial church of Saxony-Anhalt and Thuringia, with a membership totaling 17% of the regional population.
It has an income of 102 million Euros ($115.9 million) from church taxes, 40 million Euros (nearly $45.5 million) from direct state subsidies, and 8 million Euros (nearly $9.1 million) from voluntary donations in 2017.
For a church with 750 ordained ministers (full-time equivalents), 40 million Euros (nearly $45.5 million) are undoubtedly substantial.
Additionally, there are indirect forms of state subsidies to the two major churches, including state funding of theological university departments.
In German universities, with very few exceptions, only Roman Catholics and members of the Protestant territorial churches can teach theological subjects.
In contrast, the free churches must operate their own, donation-based seminaries for which they do not receive public support.
The church tax system and the privileges traditionally granted to the two major denominations may seem odd from a theological as well as from a political perspective. However, the system is virtually uncontroversial in Germany.
German church leaders seem to be unworried about the entanglement between their churches and the state.
Indeed, they can rely on the sympathies of most politicians who are anxious to provide good conditions for the two major churches, which are rightly perceived as pillars of civil society in a country whose democracy is relatively young.
The worrying question remains whether Germany’s churches will be prepared to sustain themselves in case the church-friendly political consensus should ever erode in future.
Editor’s note: This article was requested by EthicsDaily.com to help contextualize a Pew Research Center report published in late April 2019 that focused on church taxes collected by many governments in western Europe.
Martin Rothkegel is professor of church history at the (fully donation-based) Baptist theological seminary in Elstal, Berlin, Germany.