Religious congregations provide a net $16.5 billion worth of social and economic benefits to Canadians 

FOR IMMEDIATE RELEASE

November 12, 2024

OTTAWA – New research confirms that all Canadians are better off when governments exempt religious congregations from paying taxes. In its report, Why Religious Tax Exemptions Benefit All Canadians, think tank Cardus finds that, measured in dollars and cents, what religious congregations give to their communities is worth almost 10.5 times as much as the tax exemptions and credits they receive.

“Church tax exemptions pale in comparison to the value of the social and economic contributions congregations make to their communities and neighbourhoods,” says Dr. Lisa Richmond, Vice-President of Research at Cardus. “Churches and other religious congregations give more than they receive.”

The Halo Effect

The findings are based on religious congregations’ Halo Effect – the dollar value of their social and economic contributions to society. Calculating the Halo Effect involves adding up the dollar values of the following activities of Canadian religious congregations:

• Providing space, often at below-market rates or for free, for cultural and artistic events, recreation and sports, education, social services, and other activities
• Providing programs and services, such as addiction recovery, counselling, mental-health services, childcare, refugee sponsorship and settlement services, education, and food banks
• Contributing to the economy through direct spending
• Generating economic activity through the “magnet effect” of attracting attendees to bar/bat mitzvahs, funerals, weddings, and other ceremonies, who then spend money at local businesses
• Providing open space, which has environmental and recreational value

For the purposes of Why Religious Tax Exemptions Benefit All Canadians, Cardus calculated the Halo Effect and the value of tax exemptions and credits for 64 Christian congregations in Canada. Their average Halo Effect was worth 10.47 times as much as the average value of their tax exemptions and credits. In other words, these congregations, provide, on average, almost 10.5 times the social and economic benefit that taxation would provide.

Staggering National Figures

A previous Cardus study estimated that Canada’s religious congregations collectively have a Halo Effect of about $18.2 billion annually. With the Halo Effect being 10.47 times greater than tax exemptions and credits, Canadian congregations’ tax exemptions would come to about $1.7 billion. This means religious congregations make a net positive $16.5 billion socio-economic contribution to Canada.

Taxing Religious Congregations Hurts Everyone

If religious congregations had to pay taxes or couldn’t issue charitable tax receipts, their Halo Effect would likely shrink. Every tax dollar a congregation paid would leave less money available for the social and economic benefits they provide. And if congregations’ Halo Effect shrank by more than 10%, the economic loss to our communities and neighbourhoods would outweigh the increase in government revenue.

“Most of what churches and other religious congregations do can’t be measured in dollars and cents,” says Dr. Richmond. “How can you place a dollar figure on ethical teaching or on helping people find ultimate meaning? But many of their activities do have a dollar value, which is worth more than any revenue governments could raise by taxing religious congregations.”

Why Religious Tax Exemptions Benefit All Canadians is freely available on the Cardus website.

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Cardus is a non-partisan think tank dedicated to clarifying and strengthening, through research and dialogue, the ways in which society’s institutions can work together for the common good.