Hague Court deals blow to Scientology tax-free status


The Dutch branch of the Church of Scientology has lost its tax status as “public welfare institution”, and the tax benefits that go along with it, in a ruling made by the court in The Hague on Wednesday.

The court decided that the sales of the Church’s expensive courses and therapy sessions are clearly aimed at making a profit, and thus it does not belong on the tax authorities’ charity list.

Scientologists believe that there are two major divisions of the mind – the reactive mind and the analytical mind, according to Wikipedia. The reactive mind stores painful and debilitating images, “engrams”, that move people further away from their true identity. The Church promises believers that they can get rid of these engrams with special techniques and eventually achieve a “clear” state – a sort of super human with a clear mind. The Church offers courses and therapy sessions to work towards this “clear” state, and these quickly cost thousands of euros.

The court ruled that these courses cost significantly more than commercial educational institutions’ average school fees. “If providers on the secular education market had similar prices, prospective students would experience it as prices for top education by top teachers in prime locations.” The court finds the prices to be very commercial. According to the court, Scientology consciously seeks profits to fill its purse and was able to build “substantial wealth” like this.


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An update in a comment on the Underground Bunker:

Scientology, of course, appealed. First with the Tax Office itself and, after that failed, in the courts. The lowest court verdict dating back from april last year was only published a few weeks ago. The ruling is a straight forward dress-down of the arguments put forward by the Church, bordering on a tongue-in-cheek style (one
of the judges’ comments reads as a double entendre mocking the folly of buying such a huge building for such a tiny Church). Anyways, the court confirmed that Nabesa isn’t tax exempt and the retrospective removal of this status was rightful. And that means that the verdict is a go-ahead for the Tax Office to levy the back tax. The size of the fine is a bit difficult to calculate because the first 2 grand of each donation per household per year is exempt from the gift tax. But we do know that the donations in the period are very close to €3M and that the rate of the gift tax is 30%. This means that the upper limit of the fine is 900k€, with realistic estimates ranging between 550K€ and 750K€.