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Wednesday, May 26, 2010
Sunday, May 16, 2010
City Harvest Church questioned over its $310 million stake in Suntec
City Harvest Church (CHC) has been questioned by the Commissioner of Charities over its $310 million purchase of a stake in Suntec Singapore which it announced two weeks ago, the Straits Times reported today.
The Church said earlier that it would use two floors in Suntec to house a 12,000-seat auditorium for worship services and that it would be used exclusively for its services, except for about five times a year to allow for international conferences or events to be held there.
The stake raised some eyebrows among Singaporeans who questioned if registered charities should be allowed to go into business and if the income collected by CHC through its Suntec rentals would be taxed.
An irate Singaporean Lester Lam wrote to the Straits Times Forum on 11 March 2010 questioning the relevance of giving religious organisations tax-exempt status when many of them own commercial properties and derive rental income from them.
“Should the Government continue to let religious organisations own commercial properties and earn income from rent? After all, the revenue these organisations use for the purchase is tax-exempt in the first place. Suntec City was developed for commercial purposes. With the church’s purchase of the development and its proposal to convert a section of the exhibition space for church use, is it in breach of the Urban Redevelopment Authority’s land-use policy?” he asked.
A letter jointly issued by the Ministry of Community Development, Youth and Sports, the Urban Redevelopment Authority (URA) and the Inland Revenue Authority of Singapore explained that “incomes earned by charities are tax-exempt because their main purpose is to provide public benefits through their activities.”
There are no laws against charities being involved in business activities except that they “must be done in the best interest of the charity and not subject the charity’s assets and resources to unacceptable risk.”
The Straits Times article did not reveal the exact questions asked by the Commissioner of Charities to CHC. Its Senior Pastor, Kong Hee could not be reached for comments.
The Church said earlier that it would use two floors in Suntec to house a 12,000-seat auditorium for worship services and that it would be used exclusively for its services, except for about five times a year to allow for international conferences or events to be held there.
The stake raised some eyebrows among Singaporeans who questioned if registered charities should be allowed to go into business and if the income collected by CHC through its Suntec rentals would be taxed.
An irate Singaporean Lester Lam wrote to the Straits Times Forum on 11 March 2010 questioning the relevance of giving religious organisations tax-exempt status when many of them own commercial properties and derive rental income from them.
“Should the Government continue to let religious organisations own commercial properties and earn income from rent? After all, the revenue these organisations use for the purchase is tax-exempt in the first place. Suntec City was developed for commercial purposes. With the church’s purchase of the development and its proposal to convert a section of the exhibition space for church use, is it in breach of the Urban Redevelopment Authority’s land-use policy?” he asked.
A letter jointly issued by the Ministry of Community Development, Youth and Sports, the Urban Redevelopment Authority (URA) and the Inland Revenue Authority of Singapore explained that “incomes earned by charities are tax-exempt because their main purpose is to provide public benefits through their activities.”
There are no laws against charities being involved in business activities except that they “must be done in the best interest of the charity and not subject the charity’s assets and resources to unacceptable risk.”
The Straits Times article did not reveal the exact questions asked by the Commissioner of Charities to CHC. Its Senior Pastor, Kong Hee could not be reached for comments.
Thursday, May 6, 2010
City Harvest Church continues to come under fire from skeptical Singaporeans on ST Forum over its purchase of Suntec stake
City Harvest Church continues to come under fire from skeptical Singaporeans three weeks after it announced that it has bought a $310 million stake in Suntec to be used for its worship services.
Since then, more than a dozen of letters have been published in the Straits Times Forum questioning if City Harvest Church should still be considered as a charity and if the returns from its property investments should be exempted from tax.
Two letters are published today in the Forum on the matter alone.
Ms Tan Saw Bin who is an auditor of several charitable groups wonder if “significant involvement in commercial activities by mega churches, through investments in properties, still qualify the churches as charities under the Charities Act and their Constitutions.”
She urged the authorities including the Registrar of Societies and Commissioner of Charities to “look into statutory compliance and evaluate if such religious groups still qualify as charities.”
“New Creation Church and City Harvest Church are registered as charities but not Institutions of a Public Character. This means that donations to these churches are not tax exempt, so donors do not enjoy tax deductions of 2.5 times. Nevertheless, I am impressed by the ability of these churches to obtain significant donation income, which is a feat few organisations can match,” she added.
Another Singaporean Harvey Neo pointed out the blurring of lines between a religious group and its associated business entity in reality:
“For example, the initial start-up funds for the business entity could come entirely from the church. Tax-exempt funds from the church might also be diverted to the business entity in indirect ways.”
He stressed that the problems arises when “the associated businesses of a religious group balloon to such an extent that one starts to forget the raison d’etre of religion and begins to wonder where the profits of such businesses go to.”
City Harvest Church was founded by its Senior Pastor Kong Hee in 1989 as a small Bible study group of 20 and has since ballooned to a mega Church with more than 33,000 members.
Since then, more than a dozen of letters have been published in the Straits Times Forum questioning if City Harvest Church should still be considered as a charity and if the returns from its property investments should be exempted from tax.
Two letters are published today in the Forum on the matter alone.
Ms Tan Saw Bin who is an auditor of several charitable groups wonder if “significant involvement in commercial activities by mega churches, through investments in properties, still qualify the churches as charities under the Charities Act and their Constitutions.”
She urged the authorities including the Registrar of Societies and Commissioner of Charities to “look into statutory compliance and evaluate if such religious groups still qualify as charities.”
“New Creation Church and City Harvest Church are registered as charities but not Institutions of a Public Character. This means that donations to these churches are not tax exempt, so donors do not enjoy tax deductions of 2.5 times. Nevertheless, I am impressed by the ability of these churches to obtain significant donation income, which is a feat few organisations can match,” she added.
Another Singaporean Harvey Neo pointed out the blurring of lines between a religious group and its associated business entity in reality:
“For example, the initial start-up funds for the business entity could come entirely from the church. Tax-exempt funds from the church might also be diverted to the business entity in indirect ways.”
He stressed that the problems arises when “the associated businesses of a religious group balloon to such an extent that one starts to forget the raison d’etre of religion and begins to wonder where the profits of such businesses go to.”
City Harvest Church was founded by its Senior Pastor Kong Hee in 1989 as a small Bible study group of 20 and has since ballooned to a mega Church with more than 33,000 members.
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