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governments, particularly Japan and South Korea.
(5) The task force should seek information from appropriate State and local
governments and should make information available to State and local
governments for use in appropriate proceedings involving enforcement of their
laws.
The subcommittee also recommends that appropriate committees of the
Congress review certain information pertaining to the Moon Organization.
Current U.S. tax laws and regulations made it impractical for the subcommittee to
examine the tax returns of such Moon Organization components as the
Unification Church International, which was denied tax-exempt status by the IRS.
However, there is reason to believe that taxable Moon Organization components
derive tax advantages from transfers to tax-exempt components. Since both
taxable and tax-exempt organizations are used interchangeably in the Moon
Organization, such tax advantages would enable the Moon Organization to
pyramid economic power and achieve a substantial advantage over competing
organizations. The subcommittee therefore suggests a review by the House
Ways and Means Committee and the Senate Finance Committee which have
access to tax returns--to determine whether transfers of funds within the Moon
Organization raise issues which point to the need for legislation to prevent the
abuse of tax-exempt status. More specifically, the subcommittee recommends
that the House Ways and Means Committee and the Senate Finance Committee
review the applications for tax-exempt status (where applicable) and the tax
returns of Moon Organization entities, including:
Unification Church; Freedom Leadership Foundation; Unification Church
International; International Cultural Foundation; Korean Cultural and Freedom
Foundation; Tong-Il Enterprises; One-Way Productions; International Oceanic
Enterprises; and News World Communications.
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and determine whether:
(a) Income from abroad is properly reported.
(b) Deductions are taken by businesses for charitable contributions to tax-
exempt organizations, the actual control of which is in the hands of the same
persons and organizations in control of the businesses.
(c) New legislation or regulations are needed to prevent tax avoidance and
pyramiding of economic power by means of recycling funds through an
international organization, part of which is tax-exempt.
The subcommittee has also referred its findings to the Armed Services and
Intelligence Committees of the House and Senate, and to the Munitions Control
Board of the State Department, with the suggestion that more precise information
be obtained about the Moon Organization's role as a Korean defense contractor.
During the investigation, the subcommittee found it very difficult to obtain reliable
information about the extent to which Moon industries were involved in weapons
production and sales. The Moon Organization has self-proclaimed goals of
controlling political and secular institutions and a strident ideology which
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