What does ending tax exemptions for Christian clergy mean for Hindu Undivided Family benefits?
The Supreme Court has endorsed removing tax exemptions for Christian clergy. This raises questions about equality for all religions in the tax system.
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A decision by the Supreme Court last month endorsed a 2019 Madras High Court judgement striking down income tax exemptions granted to Catholic clergy. The court emphasised the secular nature of tax laws and clarified that tax provisions operate independently of religious vows, theocratic laws or obligations to religious orders. This ruling could have implications for the Hindu Undivided Family, the only other group that receives preferential tax treatment based on religion.
Among the advantages that benefit the Hindu Undivided Family, a legal entity under Hindu personal law, are separate tax filings, exemptions and deductions that allow Hindu, Jain. Sikh and Buddhist families to reduce their collective tax liabilities.
The judgment could intensify scrutiny of these provisions, especially as debates on a Uniform Civil Code gather momentum.
Equal before the law
The case before the Madras High Court in 2019 involved income tax exemptions for Catholic priests and nuns by the income tax department through circulars issued between 1944 and 1977. In April 2016, the Central Board of Direct Taxes withdrew the income tax exemption, stating that its earlier circulars granting the exemption were based on an incorrect interpretation of the 1944 circular.
This withdrawal was challenged before the High Court by a Chennai-based Christian religious institution – the Society of Mary Immaculate – that runs several...
