＜prologue＞
I started a blog called “The Baby Boomer Generation’s Miscellaneous Blog”（Dankai-sedai no garakutatyou:団塊世代の我楽多（がらくた）帳） in July 2018, about a year before I fully retired. More than six years have passed since then, and the number of articles has increased considerably.
So, in order to make them accessible to people who don’t understand Japanese, I decided to translate my past articles into English and publish them.
It may sound a bit exaggerated, but I would like to make this my life’s work.
It should be noted that haiku and waka （Japanese short fixed form poems） are quite difficult to translate into English, so some parts are written in Japanese.
If you are interested in haiku or waka and would like to know more, please read introductory or specialized books on haiku or waka written in English.
I also write many articles about the Japanese language. I would be happy if these inspire more people to want to learn Japanese.
my blog’s URL:団塊世代の我楽多（がらくた）帳 | 団塊世代が雑学や面白い話を発信しています
my X’s URL:団塊世代の我楽多帳（@historia49）さん / X
<Added July 18, 2022> Tetsuya Yamagami, the suspect who shot former Prime Minister Abe out of resentment toward the former Unification Church
Reports following the incident have revealed the extent to which the former Unification Church engaged in shady fundraising activities under the guise of “donations” (stolen funds that not only drove Tetsuya Yamagami’s mother into bankruptcy but also ruined the lives of his family).
Now is the time to expose and clarify the true nature of religious corporations that demand large donations from Japanese believers, as the former Unification Church did, and engage in unscrupulous business practices such as “spiritual sales.” I also believe that the tax exemption and preferential tax treatment for religious corporations should be immediately abolished.
Although Japan has lifted its state of emergency and there are moves to resume economic activity, the global spread of the novel coronavirus pneumonia (COVID-19) pandemic continues, and Japan has begun to resume economic activity with caution.
If the global economic stagnation continues for a long time, it could lead to a recession worse than the Lehman Shock and, in extreme cases, a major depression.
I previously wrote an article on “Measures to Overcome the COVID-19 Recession,” but this time I would like to introduce another measure: abolishing tax exemptions and preferential tax treatment for religious corporations.
Incidentally, regarding the second supplementary budget for fiscal 2020 to combat COVID-19, it was reported on May 28th that “the government was temporarily considering including religious corporations in the ‘Sustainability Subsidy’ program aimed at small and medium-sized enterprises.”
This sparked widespread opposition within the LDP General Affairs Committee, citing suspicions of a violation of Article 89 of the Constitution, which prohibits the expenditure of public funds on religious organizations, and was reportedly excluded from the Cabinet decision-making process on the 27th. This is clearly a violation of the Constitution, and I find it hard to believe and appalling that such a proposal would even be put forward.
Now is the time to make a decision to abolish tax exemptions and preferential tax treatment for religious corporations.
1. What is the abolition of tax exemptions and preferential tax treatment for religious corporations?
A “religious corporation” is an organization whose primary purpose is to spread doctrine, conduct religious ceremonies, and educate and nurture believers. The precincts of religious corporations are treated as public facilities, and they are considered public interest corporations due to their high level of public benefit, preserving traditions, culture, and the arts.
According to journalist Naoki Yamada, abolishing the tax exemptions and preferential tax treatment for religious corporations could result in an annual increase in tax revenue of 4 trillion yen.
(1) Tax Exemption for Religious Corporations
Public interest corporations, such as “school corporations” and “religious corporations,” are exempt from corporate tax on income that does not qualify as profit-making activities.
Typical examples of “tax-exempt items” include donations, amulets, talismans, fortune-telling slips, offerings, sutra chanting fees, posthumous name fees, and offerings for sacred offerings. However, even for tax-exempt items, if there is an unusual difference between the purchase cost and the sales price, it is considered a sales profit and is deemed taxable.
However, “profit-making businesses” such as “coin parking lots near temples,” “sales of calendars and postcards,” “real estate sales,” and “publishing” are taxable. I was once surprised to see the word “offering” printed on a parking receipt from a parking lot near a temple, even though I don’t remember making any offerings…
Furthermore, when “individual religious figures” such as monks and Shinto priests receive salaries or bonuses from religious corporations, they are subject to income tax and local resident tax, just like ordinary salaried workers.
(2) Preferential Taxation for Religious Corporations
The preferential corporate tax treatment for religious corporations offers significant benefits that outweigh the risks and disadvantages of high maintenance and management hurdles.
For example, 20% of income is allowed as a “deduction” as a “donation to the religious corporation’s core business.” The remaining 20% is taxed at a lower rate than usual, and interest and dividends are generally not taxed.
2. Problems with Religious Corporations
(1) Profit-making is More Important Than Public Benefit
This may have been the case in the past, but now religious corporations are more focused on profit than public benefit.
Providing such religious corporations with preferential tax treatment or tax exemptions would likely be unacceptable to many citizens.
(2) Increase in Religious Corporations with Unclear Activities
According to the Agency for Cultural Affairs’ “Religious Statistics Survey” (2018), there are 7,079 individual religious corporations and 399 umbrella religious corporations, for a total of over 180,000 (as of December 31, 2017).
However, in recent years, there has been a sharp increase in the number of non-reporting and inactive religious corporations, making it difficult to grasp the true nature of some religious corporations. This, combined with the current difficulty of revoking certification, has led to a seemingly endless stream of cases that serve as a breeding ground for tax evasion.
(3) Buying and Selling Dormant Religious Corporations
This raises concerns about tax evasion using religious corporations as a cover.
The Asahi Shimbun published a feature article on the de facto buying and selling of religious corporations on January 30, 2011.
Religious corporations are eligible for significant tax breaks, and in order to take advantage of these benefits, they are openly being bought and sold online.
The reason behind this is the rapid increase in dormant religious corporations. “Dormant” refers to corporations that have not submitted a one-year activity report to the national or prefectural government.
According to an Asahi Shimbun investigation, “of 182,527 religious corporations nationwide, 16,750 were dormant, accounting for 9.2% of the total.”
It appears that real estate agents are intervening in the buying and selling of these dormant religious corporations. According to sources, the quickest way to exploit them is to purchase a dormant legal entity.
Dormant corporations are often used as a vehicle to receive profits from hotels and restaurants registered in the name of their companies, thereby concealing income. In short, religious corporations are being misused.
(4) The inclusion of the Komeito Party, which is supported by a specific religious corporation, in the ruling coalition is a bottleneck.
I think many people have doubts about tax exemptions and preferential tax treatment for religious corporations. I believe the reason the government and the LDP have not yet embarked on reforms is due to the existence of the Komeito Party, which is supported by a specific religious corporation.
(5) The existence of large religious corporations supporting the LDP is also a bottleneck.
However, it’s not just the Komeito Party that supports the LDP; there are also large religious corporations (such as the former Unification Church and Rissho Kosei-kai) that support the LDP. Eliminating the tax exemptions and preferential tax treatment for religious corporations, which would deprive these religious corporations of their vested rights, could lead to the loss of a large voting base, and so the current reality may be that it is difficult to take action.