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The Watchtower Society And Taxes
Taxes? The Watchtower Society hates them, and avoids them whenever possible.
Here in Canada they had sudden "new light" when our Goods and Services Tax of 7% came into effect. Up till then they sold their magazines to their followers, who resold them to the public and pocketed the revenue. Very straight forward, and very fair.
To avoid the tax, they began placing their literature on a "donation" basis. Their followers, called " publishers" still pay at the Kingdom Hall, but it's called a "suggested donation". That's payment number one.
The publisher then places the literature at the door and asks for a "donation". This is payment number two. The publisher must then turn this money in to the Kingdom Hall. This means the Watchtower is paid at least TWICE for each item and no tax!
No wonder they have the cash to buy up some of the highest-priced real estate in the world at Brooklyn, New York, and then pay no property taxes! Quite a profitable little scheme if you can get away with it, under the guise of "charity".
We have long hoped that Canada, the United States and the United Kingdom, who are being deprived of tax dollars in this way would wake up and audit this sales organization.
We were delighted to find the government of France leading the way!
The Government of France has decided enough is enough! They realize the WBTS is a large publishing house making huge profits, and have imposed a 60% tax, classifying them as a business & not a charity.
An INTERNET report under date of July 5, 1998 states that the Society in France owes $50 million in back taxes, made up of $25 million owing, plus penalties and interest, which doubles the amount.
A lien was put on all Watchtower-owned property in France. The French tax authorities made this decision after a revealing audit of all donations was done.
The Witnesses are fighting back with a full-page advertisement costing thousands of dollars in the New York Times of Sunday, July 5th, 1998. (Estimated cost of $82,000 using commercial rates.) As usual, they are trying "scare tactics" to get other religions to back them, lest they be audited and taxed also, but genuine charities have nothing to fear.
Jehovah's Witnesses have even become quite noble in their statements, such as,
"Jehovah's Witnesses in France will challenge this gross act of religious discrimination. They will do this not only to avoid an unjust and oppressive tax but also to help assure that all French people enjoy freedom of religion.
Mr. President, we are confident that you believe in the principles of liberty, equality, and fraternity. We therefore ask for your support in removing this unjust and discriminatory tax and avoiding a dangerous threat to religious freedom and human rights in France."
Kind of chokes you up, doesn't it? They believe the French government is under Satan's control, yet they quote government slogans when it suits them! The only caring they have for those outside their own group is an effort to bring them in. If they won't come, they are soundly condemned to death by Jehovah God at Armageddon.
According to the Watchtower, over 200,000 French Citizens have contributed to them.
The Government is dead-on right when they ruled that the organization is carrying on a business activity. We can only hope that the Governments of the USA. Canada, and the United Kingdom will take a good, long, look at this publishing house and call it what it is, a business subject to tax.
MEANWHILE, BACK AT THE RANCH IN CANADA
A reader sent me the Registered Charity Information Return and Public Information Return for Canada for the years 1992 to 1996 for the WBTS in Canada. He pointed out several fascinating facts from these returns, which I will now pass on to you. If any Canadian auditors are reading this, please also take note of the following:
WHAT? NO ESTATES OR
We find it hard to believe that on all returns from 1992 through 1996, they did not receive a single "Gifts of capital received by way of bequest or inheritance". They have marked this section "n/a" (not applicable). How come we have heard from several families who have lost their estates to the Society? How come the Society is constantly lobbying for estate funds from its members? What's going on here? Are Canadian estate funds going directly to Brooklyn, New York? Where are they?
WHY SO MUCH 'UNRECEIPTED'
Also of interest is the "total receipts" figure fluctuating between 20 - 26 million dollars. Since tax receipts for donations ran about 5 - 7 million dollars, how do they account for the rest, a difference of between 15 -19 million? Well, they claim they got about 7-8 million from "other registered charities". I don't know of a single charity who would give them beans, so it is a good guess that they are probably selling their literature to other countries and reporting the revenue as "donations" rather than "sales". Or, could "big brother" in Brooklyn be shuffling funds into Canada? We wonder. We hope government auditors will wonder, too.
LOST TAX REVENUE?
In any event, we are left with a figure of 4-6 million showing as "gifts for which "official receipts" have not been, and will not be issued". We strongly suspect that some of this is their Canadian revenue from literature sales (oops, pardon me--donations from placing literature). This robs Revenue Canada of up to $420,000 in tax revenue, if we are correct.
INVESTMENT AND PROPERTY?
Also puzzling are their figures for "investment and property income" which rose from a 1992 total of just over 2 million dollars to a 1996 total of well over 3 million dollars. If they didn't receive any property as they claim, what is this? It takes a lot of playing the stock markets to generate over 3 million in profits, but if this is the case, why are no capital gains reported? Again we see the "n/a" in this space. Is it interest income? That takes even more capital to generate. We wonder.
FUNDS LEAVING THE COUNTRY
Also, why did 15 million dollars get disbursed outside Canada in 1996? The Canadian Government does not take kindly to Canadian charity funds "going South". Why the exception for the Watchtower Organization?
Their 1996 return claims they carried on "charitable programs" in several countries, but in the same section, they admit they have "contracts with associated branches", for this same 15 million dollar figure. We feel this is no "charitable program" but the printing and selling of publications from Canada for other countries, a business transaction!
GOT ANY SPARE CHANGE?
Also, in 1996 they had over 30 million dollars in cash in their Canadian bank account! Added to other assets, the Canadian Branch Office is basking in wealth, over 103 million dollar's worth! Liabilities totaled only over 17 million dollars. Rather rich for a "charity, aren't we?
Jehovah's Witnesses' Statement of Purpose and Activities was quite a piece of propaganda, containing several very questionable statements. For example, regarding their huge publishing house activities, they state:
"...Although some of this literature was used by members of the organization themselves, the majority was distributed to the public free of charge...".
If the Canadian Government can swallow that, they can swallow anything! What about the "donations" solicited at every door for the literature? What about every piece of literature being "donated" for TWICE?
In any event, we can only hope that the Canadian Government will take their lead from the enlightened nation of France. We can hardly wait until the USA government raids the really big guys with the really big bucks in Brooklyn, New York. The United Kingdom should examine the headquarters there too. They just think they are exempt like royalty, but their days may be numbered, we hope.
When the axe does finally fall on this wealthy organization worldwide, and they get what they so richly deserve, it still will not make up for the lives and families destroyed by this group. Nor will it bring back to life those who have died refusing necessary medical treatment in the form of blood transfusions. We can only await future developments.
Late-breaking news off the internet has the governments of Germany and Italy taking a closer look at the Watchtower Society.
The highest Italian court (Corte Suprema di Cassazione) has declared that the Society had carried on a commercial activity when printing literature.
We are awaiting further news