Inside Scientology - Janet Reitman [93]
On the evening of October 8, 1993, more than ten thousand Scientologists, the largest meeting of Scientologists in history, gathered at the Los Angeles Sports Arena. The stage at one end of the arena was draped in blue banners, with gilded romanesque columns and torches. Miscavige stood at the podium in a black tuxedo, beaming.
"There will be no billion dollar tax bill [to the IRS] which we can't pay," Miscavige announced. "There will be no more discrimination. There will be no more twenty-five hundred cases against parishioners across the United States. The pipeline of IRS false reports [about Scientology's activities] won't keep flowing across the planet. There will be no more nothing—because"—Miscavige paused for dramatic effect—"the war is over!" The band launched into triumphant music and the audience rose to their feet, screaming and cheering as the words "THE WAR IS OVER!" flashed on giant screens behind Miscavige's head.
Marty Rathbun has always insisted that the Church of Scientology won its exemption legitimately, through lawsuits and other above-board forms of pressure. Aside from the testimony of Michael Shomers, there has never been any evidence to prove that Scientologists brought into play some of the more underhanded tactics they had used, for example, in the prior assault on the IRS, Operation Snow White. But the sheer magnitude of the church's exemption was astounding. The deal granted tax exemption to all of Scientology's 150 U.S. entities, including Miscavige's RTC; the seat of its international management, the Church of Scientology International; the Flag Service Organization in Clearwater, Scientology's largest and most successful "church"; and its advanced organizations in Los Angeles. It also gave exemption to the church's various social betterment programs. These included Narconon, a franchised network of drug treatment and rehabilitation centers, whose directors often claim to have no direct association with the Church of Scientology; Applied Scholastics, an organization that licenses a special, Hubbard-endorsed educational method called "study technology" to Scientology-run schools as well as to secular public schools and tutoring programs; and the Citizens Commission for Human Rights, a lobbying organization that promotes Scientology's anti-psychiatry agenda in Washington and elsewhere. Also exempt were the two publishing houses that were the exclusive publishers of Hubbard's books, both the Scientology-related texts and his wholly secular, and profit-generating, fictional works.
Though it owed roughly $1 billion in back taxes, Scientology had been fined just $12.5 million. The IRS also canceled payroll taxes and penalties against seven top Scientology officials, including Miscavige, and dropped audits of thirteen Scientology organizations, including the Church of Scientology International. In exchange for all of this, Scientology agreed to drop the thousands of lawsuits it had brought against the IRS and its officials.
And not only that, Miscavige announced triumphantly, but all future Scientology churches would never have to go through the exhaustive paperwork the IRS requires to prove tax-exempt status: all they would have to do would be to meet specific qualifications laid out and enforced by Scientology's Mother Church, which would grant these new organizations exemption themselves and then pass along the pertinent data to the IRS for its records.
Every audit or tax action currently pending against Scientologists was canceled. "There are no more tax court cases, there are no more disallowed deductions," Miscavige said.