The Nicaraguan Parliament has passed new tax measures that require churches and religious organizations of all denominations to pay taxes on donations received from their believers.
By Giancarlo La Vella
On August 20, Nicaragua’s National Assembly approved a tax reform that eliminates tax exemptions for religious institutions. They must now pay income tax on activities and assets, even if they serve exclusively religious purposes.
According to independent Nicaraguan media, the amendment to Law 822 will require all churches, regardless of their denomination, to follow a tax system similar to that of the private economic sector, where legitimate profit is the goal of all activities.
Offerings, alms and donations from believers are therefore subject to income tax at a rate of 10 to 30 percent.
It is noted that the abolition of tax exemptions will have a serious impact on the operational and financial capacity of religious communities engaged in education, social and aid work, with significant consequences, particularly for the most vulnerable groups in society.
The reform comes in a difficult context for the Catholic Church and other religious and civil organizations.
Following the arrest and expulsion of priests, the Nicaraguan government recently stripped another 1,500 non-governmental organizations, many of them religious, of their legal personality and transferred their assets to the state.
The United Nations High Commissioner for Human Rights expressed his “deep concern” about this decision. In a communiqué, he said that the Nicaraguan government’s initiative represented a “threat to freedom of religion and association.” He called for the “guarantee and protection of fundamental freedoms” of the individual.
