Tax Exemption of Church Property: Historical Anomaly or Valid Constitutional Practice?

54 Pages Posted: 25 May 2011

Date Written: 1991


The practice of taxing church property while exempting other nonprofit groups appears to violate the “no special burden” principle of the free exercise clause. The Supreme Court case of Walz v. Commission charted a course between the free exercise and establishment clause. The Court argued from neutrality, separatism, and history to state that tax exemption of church property is part of an unbroken national tradition. However, the Court’s neutrality argument does not address constitutionality, its separatism argument is contrived, and historically, only established religions have been exempt from taxation.

Past tax exemptions are rooted in two traditions: the common law adopted from England that granted exemptions to established churches, and the equity law tradition that granted exemptions to all churches. The common law tradition was restricted to certain types of church property of established churches, and the exemptions could be put on hold during times of emergency. The equity tradition gave churches another chance; ecclesiastical and charitable organizations could be tax exempt.

These traditions continued uninterrupted in the early American republic. Three provisions ultimately provided ground for a challenge to the tax exemption of church property. The disestablishment of religion undercut the authority of officials to prefer one religion over the other. The truncation of the equity tradition removed the equitable privileges given to charities. Finally, equal and uniform taxation was considered a basis of American life.

In modern theory, churches are seen as beneficial to society because they promote public morality, charity, and education. The law of equity is now based in statutory schemes or state constitutions, but the religious use of property is key to its tax exempt status. In the future, courts must find a via media between the eradication of exemptions and blanket endorsements.

Keywords: Tax, exemption, church, property, America, Walz v. Commission

Suggested Citation

Witte, John, Tax Exemption of Church Property: Historical Anomaly or Valid Constitutional Practice? (1991). Southern California Law Review, Vol. 64, No. 2, p. 363, 1991, Emory Legal Studies Research Paper, Available at SSRN:

John Witte (Contact Author)

Emory University School of Law ( email )

1301 Clifton Road
Atlanta, GA 30322
United States
404-727-6980 (Phone)
404-712-8605 (Fax)

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