Any church legal person, i.e. a parish, order, diocese, Caritas, etc., can conduct business activity. How many of them in Poland do this? It is not known. This data is not published anywhere. TVN24 however, he learned that in 2022 alone, church businesses generated nearly 324 million in profit. This is the amount from 1,008 church entities (the lion's share of the Catholic Church). What's even more shocking – they didn't pay a penny of tax on it. How is that possible?
Church business activity exempt from tax
We have to go back to 1989, when the communists wanted to curry favor with priests. They passed a special tax relief for churches and religious associations conducting business activities. It exempts church business from taxes. However, tax-free profits according to this act must be allocated for the following purposes: “religious worship, educational and upbringing, scientific, cultural, charitable and care, for the conservation of monuments, for running catechetical points, for religious investments in the scope of: construction, expansion and reconstruction of churches and chapels, for adaptation of other buildings for religious purposes, for other investments designated for catechetical points and charitable and care institutions”.
Expenditures virtually beyond any control
However, the lawyers interviewed by TVN24 journalists say it directly: verifying what they are going for moneyis virtually impossible. “How can you tell if a limousine is actually used for religious worship or for the private needs of the hierarch? After all, a bishop is not a bishop from hours 9 to 5. We can therefore assume that everything he does, he does as part of religious worship” – describes one of many legal dilemmas to TVN24.
For this Tax Office is not very interested in the profits of church businesses. And even if the tax office wanted to take a closer look at them, its hands are tied. In the event of an inspection, a church company should document expenses that come from untaxed profit. The problem, however, is that the law does not mention when the money entitled to relief should be allocated. Such a company can always declare that it is allocating profit, for example, for religious worship purposes, but only after 10 or 20 years. Meanwhile, after five years there is no obligation to keep tax documentation.
TVN24 sent an inquiry to Ministry of Finance whether it plans to introduce any changes to these regulations. The Ministry did not respond to this inquiry, but only extended the response time until the end of September. The Polish Episcopal Conference also did not provide comment editorial office.