Churches now look beyond tithes to build multi-million empires
At least three Kenyan churches are doing business with annual turnovers of between Sh350 million and Sh1 billion, signalling increased involvement by religious institutions in taxable commercial ventures as they seek to boost their incomes.
The Coptic Orthodox Church, Nairobi Pentecostal Church (NPC) and Seventh Day Adventist Church are among the organisations in Kenya Revenue Authority’s latest listing of taxpayers in that income bracket.
The listing places them in the same income league as Kirinyaga Construction, Kenya National Union of Teachers (KNUT) and Google Kenya, among others.
Churches are required to file annual returns but are exempt from most taxes as provided for by the Non-Governmental Organisations and Co-ordination Act.
INCREASED INVESTMENTS
More recently, the institutions have increased their investment in education, healthcare, financial services, hospitality and real estate to reduce their reliance on tithes and offerings from members.
The Catholic Church, which owns one of the largest real estate portfolios in Kenya, including undeveloped land is surprisingly not on the list.
Despite increased earnings from businesses, the government has maintained the churches’ tax-exempt status on grounds that they contribute to the fight against poverty through their charitable activities.
Some schools and hospitals run by churches, for instance, offer services at subsidised rates seeking to benefit the rural and urban poor.
EXEMPT FROM TAXES
NGOs, including churches, are exempt from taxes in a process that involves co-ordination from various government agencies. An organisation has to be registered and provide evidence of its activities before it can be exempt from taxes.
Major battles for control of the businesses run by churches have, however, raised suspicions that some of the investments are initiated with self-enrichment as the primary objective.
