ST. LOUIS -- A federal appeals court said Wednesday that the Church of Scientology is a bona fide church whose fixed membership fees are tax-deductible contributions.
The ruling by the 8th U.S. Circuit Court of Appeals reversed a decision by the U.S. Tax Court.
Fees for participating in religious practices cannot be given a taxable value, the appeals court said.
"Spiritual gain to an individual church member cannot be valued by any measure known in the secular realm," the court said.
The judges noted the goverment had agreed in the case that Scientology is a religion that qualifies for tax-exempt status.
"Under the stipulations the fixed donations are not market prices set to reap the profits of a commercial moneymaking venture; rather, the Church of Scientology is a bona fide church which selected fixed donations as its mechanism for raising funds from its members."
Religious observances of any faith are considered to be of spiritual benefit to the public as well as to the members of the faith, the court said, adding that the private benefit to individual participants is "merely incidental."
"The public benefit from religion remains and predominates regardless of whether church doctrines provide for traditional congregational worship or individual worship as in Scientology or whether donations are voluntary or fixed."
Appellate judges ruled in the case of Maureen and Michael Staples, who contended the tax court was wrong to decide their payment of set fees to the Church of Scientology was not a charitable contribution.
The appeals court noted that Scientology courses and other sessions are conditioned on the payment of fees established by the church.
The Staples couple argued that "no recognizable return benefit is received when the taxpayer through the payments was seeking strictly spiritual gain," the court said.
"For example, the Internal Revenue Service has ruled that deductions should be allowed for pew rents and periodic church dues and building fund assessments," it said.