Tax dispute flairs between Cyprus gov’t and Orthodox Church

12/4/2010

A furious dispute has erupted in Cyprus after the ruling communists set their sights on the island’s wealthy Orthodox Church of Cyprus to help plug a runaway deficit. The island’s government says it wants to start a dialogue with the Church regarding the millions it says the church owes in unpaid taxes.

The church says it does not owe a penny.

“We are not tax dodgers,” said Archbishop Chrysostomos, the prelate of the ancient church which traces its roots to some of the earliest followers of Jesus. The church has broad business interests ranging from a bank to a brewery.

This echoes recent moves in Greece, where the government has decided to tax bequests and revenues from the Greek Orthodox Church’s property to help tackle a 300 billion euro ($409.9 billion) debt pile. The Church, in Greece as in Cyprus one of the country’s biggest owners of prime real estate, has until now been largely exempt from taxes even though the state pays priests’ salaries.

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