States Move to Revoke Nonprofits' Tax Exemptions
Hawaii, Kansas, Minn., Pa. and more consider levy in light of budget holes.
Faced with steep declines in tax revenue, an increasing number of states and localities are considering eliminating various tax exemptions for nonprofit groups.
A bill before the Hawaii Legislature, for instance, would require charities to pay a 1 percent tax, and Kansas is considering making them subject to sales taxes.
And last fall, Minneapolis made charities subject to the fees it charges businesses and residents for streetlights in hope of gaining an additional $155,000, an exercise Jon Pratt, executive director of the Minnesota Council of Nonprofits, describes as “looking under the sofa cushions.”
In most cases, churches would be exempt from the tax measures, but all other nonprofit groups, including private schools and colleges, would be affected.
