Exempt Since Ottoman Times, Now Taxed: Jerusalem’s Churches Face Mounting Property Tax Demands

• Jerusalem’s churches face growing demands under the municipal property tax known as Arnona
• Churches were exempt from Ottoman rule through the British Mandate and early Israeli statehood
• Municipal authorities froze the Greek Orthodox Patriarchate’s bank accounts over the tax
• Vatican-Israel talks on the tax status of church property have run for more than 30 years

Churches in Jerusalem face mounting pressure from the city’s property tax, known as Arnona, Catholic World Report said on October 7, 2025, in a report from Catholic News Agency and ACI MENA.

Arnona is charged on all properties according to their size in square metres and their use. Churches were historically exempt, from Ottoman rule through the British Mandate and the early years of the Israeli state, because they “provided services the state did not, such as education, health care, and ecclesiastical courts,” according to attorney Fareed Jibran, legal adviser to the Latin Patriarchate of Jerusalem.

About 15 years ago the legal framework changed, and tax demands began to arrive for monasteries, clergy residences, guesthouses, hospitals and organisations such as Caritas. Israeli municipal authorities recently froze the Greek Orthodox Patriarchate’s bank accounts and imposed high tax demands on its properties. The Palestinian Higher Presidential Committee for Church Affairs called this an “attack on the authentic Christian presence.”

Since 1993 the Vatican and Israel have negotiated the financial and tax status of Catholic properties. Their fundamental agreement said “neither side has the right to take unilateral measures” while talks continue, but after more than 30 years there is no settlement.

Jamaican churches enjoy relief from property tax on places of worship, but the Jerusalem dispute shows how exemptions can be narrowed over time, especially for guesthouses, residences and other buildings that earn income. Churches that rent out property or run commercial activities should keep clear records of how each building is used and be prepared for tax authorities to treat income-earning property differently from sanctuaries.