According to a report today, the Vatican is facing a new annual tax bill of €720 million.
The report from the Irish Independent has revealed the European Commission is currently in the process of re-examining the controversial tax breaks allowed to the church. The EC is planning on condemning the fiscal perks, and forcing the Vatican to pay up their taxes, which total at least €720 million per year.
The Vatican currently avoids paying property tax on 100,000 properties, which have been classed as ‘non-commercial’. This included 8,779 schools, 26,300 ecclesiastical structures and 4,714 hospitals and clinics.
Prime Minister Mario Monti has already written to the Competition Commissioner at the EC, saying that the Vatican will resume property tax payments. Monti’s government has been attempting to get the Vatican to pay tax on its properties for the past two years.
If the church begins to pay what they owe, it will be one step closer to helping Italy get out of debt, the Prime Minister believes.
A spokesman for the Competition Commissioner spoke yesterday about the proposal to force the Vatican to pay tax: “It is a proposal that constitutes significant progress on the issue and I hope it will be implemented.”
Mario Staderini, leader of the Italian Radicals party, said: “This is a victory for public pressure. We’ve managed to break down – a little bit – the wall protecting the church.”
Estimates say that the Vatican saves anything from €700million up to €2.2billion a year by avoiding paying tax on its 100,000 properties, but the church argues its tax exemption is only worth €120million a year.