The Federal Finance Office, Germany's equivalent of the IRS, this week issued ruling letters to the Church of Scientology International (CSI), the mother church of the Scientology religion, granting CSI full tax exemption on license payments it receives from nine Churches of Scientology in Germany.The decision by the Federal Finance Office (Bundesamt Fuer Finanzen) means that for the first time the Los Angeles-based mother church of Scientology is officially recognized as tax-exempt in Germany.
The exemptions relate to the information and instruction films on the religion of Scientology that CSI licenses to the German churches, including films used in the training of Scientology ministers. Until now, all churches of Scientology in Germany had been required to pay 25% of the license fees to the Federal Finance Office. CSI has now received exemptions for license fees due from all German churches: Munich, Hamburg, Stuttgart, Berlin, Frankfurt, Dusseldorf, Eppendorf, and the Church of Scientology Celebrity Centres in Munich and Dusseldorf. Each exemption is valid until the end of 2005 and three are retroactive to 1994.
The Federal Finance Office's decision to grant CSI exemption
follows a precedent-setting decision in October 2002 by the German
Federal Tax Court in Cologne. The Court ruled that Scientology Missions
International (SMI) and the International Hubbard Ecclesiastical League of
Pastors (IHELP) qualify for exemption under a 1989 income tax treaty between
the United States and Germany. SMI is the mother church for all Scientology
missions, which are smaller and minister fewer services than churches of
Scientology. IHELP provides Scientology ministers outside organized churches
with the ecclesiastical guidance they need. Both organizations have their
headquarters in Los Angeles.
Following the ruling in October, the Federal Finance Office informed Scientology representatives that the German government would not appeal and that the decision clearly applied to CSI as well.
SMI and IHELP had filed a 1996 lawsuit against the Federal Finance Office, which at that time had refused even to consider, much less give any weight to, the fact that SMI and IHELP are tax exempt in the United States. The Federal Finance Office had also refused to attach any importance to the extensive and exhaustive administrative proceedings they and other Church organizations went through to secure Internal Revenue Service (IRS) recognition as tax exempt. Ruling that these organizations qualify under the 1989 income tax treaty, the Federal Tax Court overturned the German federal tax office's May 1996 denial of the exemption applications.
Rev. Heber Jentzsch, President of the Church of Scientology International, says the recognition of CSI has major significance:
"For the first time, the German government has been compelled to consider and follow how other governments regard Scientology. This decision to grant exemption to the mother church is an important step in our efforts to be treated the same as other religions in Germany, as Germany's own constitution and international treaties require."
The ruling letters issued by the Finance Office are the
latest in a series of important victories for churches of Scientology in
Germany-related matters. In October 2002, the Federal Labor Court ruled that
staff in churches of Scientology in Germany "seek idealistic purposes and
spiritual perfection through the teachings of Scientology" and are not
therefore in an employee-employer relationship with the Church. The ruling
nullified a contrary 1995 ruling by the same Court that had been relied upon
for years by the German government to attempt to justify discriminating against
Scientologists in Germany.
Scientology has been officially recognized as a religion in many countries including the United States, Sweden, Portugal, South Africa and Australia. Hundreds of administrative and judicial decisions worldwide, including many in Germany, have found Scientology to be a religious community.
The Los Angeles, California-based Church of Scientology was founded in 1954 and today is established in 154 countries. Based on the writings of American author and humanitarian L. Ron Hubbard, it teaches people ways to improve the spiritual quality of their lives.