President Gloria Macapagal-Arroyo, a practising Catholic, has, however, poured cold water on the tax proposal, saying the Church is "the guardian of the spiritual welfare of the Filipinos and should be placed beyond the pale of monetary matters." (Photo: AFP)

MANILA—Challenged by a Catholic archbishop to scrap their “pork barrel” funds as a way of helping ease what economists call “a looming fiscal crisis” in the Philippines, some lawmakers have vented their ire on the church by saying it should be taxed.

“Exempted from paying taxes, the church and other church-based institutions should now share their enormous wealth with the nation and help the government overcome the crisis we are in,” Congressman Prospero Pichay of Surigao del Sur told reporters.

Pichay was among legislators who reacted to Manila Archbishop Gaudencio Rosales, who on 29 August challenged lawmakers to give up their “pork barrel” politics under which the government spends to enrich certain constituents, which is seen as a major source of graft.

Even as Archbishop Fernando Capalla of Davao later urged Catholics, to pitch in for a national fund to help avert a fiscal crisis and praised those lawmakers who pledged to cut back on their vote-pulling ploys, some legislators like Pichay contemplated pushing for laws that require the churches and other religious groups to pay taxes.

Under the Philippine Constitution, church groups and church-related institutions are tax-exempt in Asia’s most Christian nation, where more than 80 per cent of the people are Catholics.

Still, Rosales told reporters: “If there’s anything taxable in the Church, then go ahead.” But the archbishop said if Catholic Church were to be taxed, the government should tax all other religious groups, along with their schools and other property, he said.

The archbishop even suggested one of the European models of taxing the Church, under which the public is taxed for practising a religion but the government pays the salary and other needs of religious institutions with money collected from the faithful.

Sought for his opinion on whether or not to tax the Church, Justice Secretary Raul Gonzales said activities and properties of religious groups not used for religious purposes should be taxed to help the government raise much-needed funds.

President Gloria Macapagal-Arroyo, a practising Catholic, has, however, poured cold water on the tax proposal, saying the Church is “the guardian of the spiritual welfare of the Filipinos and should be placed beyond the pale of monetary matters.”

As the debate on taxing religious groups heats up, non-Catholic Christian evangelical groups led by the Council of Christian Bishops of the Philippines, which have a collective membership of eight million, have vowed to contribute to what is now called the Bayanihan (cooperative) Fund to help the government stave off a financial crisis.

Some officials like Senate President Franklin Drilon said, however, that while donating funds to the government was highly appreciated, it should look into long-term solutions to its fiscal woes such as getting rich corporations to pay the appropriate taxes because there are massive losses due to tax evasion.