Why is the Scientology-IRS battle such a big deal?

Personally, I am not bothered whether Scientology gets tax exemption or not. It is refused tax exemption in many countries, including the United Kingdom and Germany; in fact, the relevant official body in the UK, the Charities Commission, will this year be reviewing Scientology's tax status. (It has indicated that, as things stand, exemption will not be granted.)

But the issue of how Scientology obtains exemption is of major importance, most obviously to US citizens but also to citizens of those countries, like the UK, where Scientology is attempting to gain exemption. There is now sufficient evidence to suggest that Scientology may have pursued a twin- track strategy to gain exemption from the IRS. One track - which nobody could object to - was that the Church of Scientology sought to raise the IRS' awareness of Scientology doctrine:

"These individuals ... were willing to get the real data on Scientology. In fact, we briefed them on the entire grade chart and they even watched the LRH filmed lecture entitled "Classification and Gradation". They watched the Dianetics video. Had their own copies of WIS ["What Is Scientology?"]. And yes, one of them even picked up the cans for a [E-]meter test."

[David Miscavige, speech to International Association of Scientologists (IAS), 8 October 1993]

This is what any organisation seeking tax exemption should do. But the Church also adopted a "hardball" campaign against the IRS during the 1980s and early 1990s. There is no evidence - yet - that it did anything illegal. However, it plainly did try to exert maximum pressure against the IRS. None of the following is disputed by Scientology officials and, indeed, some of it was boasted about by David Miscavige in his October 1993 speech: Is this what one would expect of a charitable religious organisation?

Two aspects of the "hardball" approach are particularly significant. The Church of Scientology has long adopted a strategy of burying its opponents under lawsuits. The Cult Awareness Network, for instance, was bankrupted and taken over by Scientologists after numerous lawsuits were launched by the Church. David Miscavige all but admits that this is a deliberate strategy, used against the IRS as well:

"We stepped up our efforts to get government documents about us, through the Freedom of Information Act. This would escalate to literally thousands of requests, and when the IRS wouldn't comply we never failed to take them to court. Slowly we were able to start piecing together the picture. And we were also beginning to impinge on government resources. In fact, the attorneys working for the government defending these law suits were to become so inundated that their entire budget would be wiped out handling our cases - so much so that they didn't even have money to attend the annual American Bar Association conference of lawyers - which they were supposed to speak at!

[David Miscavige, speech to IAS, 8 October 1993]

The second aspect is more disturbing. L. Ron Hubbard was convinced that anyone who "screamed about Scientology" was in fact hiding crimes in their personal lives which they did not want exposed - an illegitimate child, a financial fraud, etcetera. (See Hubbard's 1966 bulletin on this subject - "Attacks On Scientology".) This remains a core belief of Scientologists and is a principle to which the Church's current "intelligence agency", the Office of Special Affairs (OSA), adheres. The New York Times revealed that private detectives, allegedly acting on the orders of OSA executives, had systematically investigated the private lives of senior IRS officials. At the same time, the Church had launched lawsuits not just against the IRS but against its individual officers in a personal capacity.

There is no firm evidence that the "hardball" tactics had a major influence on the IRS' surprise decision in 1993 to grant tax exemption to all Scientology entities in the United States, even those responsible for the commercial publishing of Hubbard's fictional works. But there are a lot of unanswered questions surrounding the decision, which raises at least the possibility that exemption was not granted purely on the grounds of merit. For instance:

It is perfectly possible that there are innocent answers to all of the above. It is possible, too, that Scientology deserves its tax exemption on merit. But it is also possible that Scientology pressured senior IRS officials into granting an unmerited tax exemption, by using private detectives and frivolous (?) lawsuits, and that the IRS is now trying to cover this up in order to save its officials' own skins.

This is just a possibility, one of a number of scenarios. The evidence so far is suggestive, not conclusive. It is, however, vital that the above questions be answered. If unfair tactics were used, this impinges on the rest of us in a number of ways:


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Last updated 12 April 1997
by Chris Owen (chriso@lutefisk.demon.co.uk)