To What Extent Do Religious Institutions Provide a Societal Value? Is the Tax-Exempt Status Justified?

• Main Author: Hou, Annabel
• Format: Others
• Published: Scholarship @ Claremont 2019
• Subjects: Religious institutions; Congregations; Churches; Tax-exemption; Societal value; Economics; Religion; Taxation
• Online Access: https://scholarship.claremont.edu/scripps_theses/1298; https://scholarship.claremont.edu/cgi/viewcontent.cgi?article=2307&context=scripps_theses

Religious institutions have been tax-exempt from almost all taxes for more than two centuries. The two primary justifications used to protect this ‘status’ is the constitution and the concept that churches provide positive externalities that believers and non-believers all benefit from. This paper examines the relationship between religiosity and five socially important characteristics: high school graduation rate, a divorce rate, incidence of domestic violence, and levels of substance abuse and crime. I run multiple simple and full regressions across 207 counties in Texas. In four of the five analyses, religiosity has a strong statistically significant desirable impact. With the addition of control variables, other explanatory variables like median household income and number of divorces have coefficients with greater magnitude but the same statistical significance as that of religiosity.