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An unexplored avenue for revenue

By Ed Goldman

In a guest editorial in The Wall Street Journal, a writer suggested that one way for our country to raise revenue would be to tax some in-name-only nonprofits—such as hospitals, universities, credit unions, athletic associations and even (gasp) consulting firms, the latter of which I own one of and, as its sole employee, am. And while my firm, Goldman Communications, Inc., wasn’t designed as a nonprofit, and has never filed to be one, it most certainly is.

The piece was written by Scott Hodge—a past president or president emeritus or ex officio hanger-on of the national Tax Foundation. He’s also the author of a book called “Taxocracy: What You Don’t Know About Taxes and How They Rule Your Daily Life.” It’s $20.99 at Amazon. Plus tax, of course.

Hodge calls out Kaiser Permanente, for example, which he says “generated more than $110 billion in revenue and $5.6 billion in net income in 2019 between its hospital, insurance and state health plans.” He also reported, “The second-largest tax-exempt sector is higher education, with more than $294 billion in revenue and $22 billion in net income in 2019.”

After reading the piece, I had two questions. The second one was, Where are the figures for 2020, 2021, 2022 and 2023, Scottie? But the first question was, Why wasn’t there any mention of what might be called highest education—houses of God? Religions. Maybe Hodge likes to hedge—his bets, that is. As the old joke goes, a man’s dying and the priest asks him to renounce the devil and all his works, to which he replies, “At this point, I’d prefer not making any enemies.”

Churches—including temples, mosques, chapels, cathedrals, tabernacles, abbeys, missions, shrines, and kirks (Scottish churches)—are exempt from federal, state, and local income and property taxes. It’s not as though they lack the dough. The richest religion in the United States is Mormonism, which rakes in $236 billion a year. The Seventh-day Adventist Church earns $15.6 billion. The Trinity Church makes $6 billion, and Scientology about $2 billion (no idea if that includes Tom Cruise’s annual tithe).

Broken down individually—an expression frequently used to describe both my emotional and financial status—my own tribe (Jews) may be “the most financially successful religious group in the United States,” a statistic that proves beyond a doubt that some generations simply get skipped. Hindus come in second, Episcopalians are third and Presbyterians come in fourth with about a third of market share.

I gathered all of these numbers from a variety of sources, including Google, Wikipedia, Harvard and FactsWhileUWait, a street vendor who’ll also sharpen your lawnmower blades or sell you boxes of strawberries with supermarket labels still affixed to them to ensure freshness. While some of the numbers are startling, if true—like, I didn’t even know there was a Trinity Church, much less that it makes an annual haul of six big ones—the whole thing makes me wonder how they escaped mention in Hodge’s piece—Scott-free, one might say.

If unintended nonprofits, like my consulting firm, could secure their own special tax-exempt status, I think the country—indeed, the world!—would be better off for it. (—No, not really. I just love it when writers add “indeed, the world!” to make a point.)