Scientology as a business
The Church of Scientology publicly classifies itself as a religion, and some scholars consider it a new religious movement, but that claim has been challenged for decades on the grounds that the Church operates more like a for-profit business than a church. Overall, as stated by Stephen A. Kent, Scientology can be seen as a "multi-faceted transnational corporation that has religion as only one of its many components. Other components include political aspirations, business ventures, cultural productions, pseudo-medical practices, pseudo-psychiatric claims, and (among its most devoted members who have joined the Sea Organization), an alternative family structure." The Church of Scientology justifies that its financial activities support its religious purpose, a position accepted by several governments globally.
Several of the Church's practices resemble business operations, including paying recruiters a cut of the money made from the people they attract and the franchising network that results in large revenues for the highest levels of the Church. Such activities distinguish Scientology from other religious organizations. The Church pays 10% commissions to recruiters, called Field Staff Members (FSMs), on new recruits they bring in who take a course or receive counseling. In addition, Church of Scientology franchises/missions, pay the Church roughly 10% of their gross income. The Church charges for auditing and other Church-related courses required for advancing through the ranks of Scientology. These programs can run to tens or hundreds of thousands of dollars.
The Scientology Bridge to Total Freedom consists of one half relating to levels of higher states of spiritual existence, and the other half the skills relating to helping another reach that level. Training is described as "50% of the route"
The Religious Technology Center maintains strict control over the use of Scientology symbols, icons, and names. It claims copyright and trademark over the "Scientology cross," and its lawyers have threatened lawsuits against individuals and organizations who have published these protected images without permission in books and on websites. Because of this, it is difficult for individual groups to attempt to practice Scientology publicly without any affiliation or connection to the "official" Church of Scientology. Scientology has sued a number of individuals who attempted to set up their own "auditing" practices, using copyright and trademark law to shut these competitors down.
Writing in Skeptic magazine, Michael Shermer contrasted such practices with mainstream religions: "Envision converting to Judaism but having to pay for courses in order to hear the story of Abraham and Isaac, Noah and the flood, or Moses and the Ten Commandments. Or imagine joining the Catholic Church but not being told about the crucifixion and the resurrection until you have reached Operating Theological Level III, which can only be attained after many years and tens of thousands of dollars in church-run courses."
The German government takes the view that Scientology is a commercial enterprise, and Belgium, France, Ireland, Luxembourg, Philippines, Israel and Mexico remain unconvinced that Scientology is a religion.
Other countries have recognised Scientology as a religion. An Australian Government Inquiry into Charities in 2001 found that the 1983 High Court case which found Scientology to be a religion, and also defined religion for the Constitution, used as the standard to determine what organisations are charitable.
L. Ron Hubbard and Scientology as a business
Critics have claimed that L. Ron Hubbard, the founder of the Church of Scientology, decided to market the practice as a religion for practical reasons. Harlan Ellison reported being present when the idea for creating a new religion was first discussed: "Lester del Rey then said half-jokingly, 'What you really ought to do is create a religion because it will be tax-free,' and at that point everyone in the room started chiming in with ideas for this new religion. So the idea was a Gestalt that Ron caught on to and assimilated the details. He then wrote it up as 'Dianetics: A New Science of the Mind' and sold it to John W. Campbell, Jr., who published it in Astounding Science Fiction in 1950." Hubbard had a different origin story and stated that Dianetics had been researched during the years 1945-50 and it was initially presented as a science, however religious ideas were added into the book Science of Survival published in 1951. After the commercial failure of the Dianetics Foundation and disputes over the direction of the subject, Hubbard revisited the possibility of classifying his philosophical teachings as a religion. In a 1953 letter, Hubbard wrote that "the religion angle" seemed to make sense as "a matter practical business".
The Founding Church of Scientology of Washington, D.C. had obtained tax-exempt status in 1956 on the claim that it was "a corporation organized and operated exclusively for religious purposes, no part of the earnings of which inures to any individual". That status was revoked in 1958, on the grounds (as argued by the U.S. Department of Justice in subsequent proceedings) that the Church's "most extensive and significant activities are directed towards the earnings of substantial fees" and "the founder of the organisation L. Ron Hubbard remains in complete control and receives substantial remuneration and perquisites both from the taxpayer and a network of affiliates". The findings of fact in the case included that Hubbard had personally received over $108,000 ($600,000 in 2012 value) from the Church and affiliates over a four-year period, over and above the percentage of gross income (usually 10%) he received from Church-affiliated organizations. In addition, the Church had paid for Hubbard's car and for his personal residence, Mary Sue Hubbard had made over $10,000 renting property to the Church, and while the $3,242 paid to Hubbard's daughter Kay had been "generally designated as salary or wages", "the record is devoid of any evidence showing services performed by Miss Hubbard for [the Church]." The Court of Claims concluded "What emerges from these facts is the inference that the Hubbard family was entitled to make ready personal use of the corporate earnings." More recently the IRS granted religious recognition and full tax deductibility to the Church of Scientology in the USA in 1993.
Take it cash in advance. Guarantee nothing. Make sure you stress its spiritual slant and value. Steer clear of promising cures. AND DON'T rush them into auditing. They'll beg for it soon enough. Actually do this to be of service to man. Try to give it away. You'll find you can't. Don't use this just because it's a 'preclear getter', it's a lot more than that. It will put you in financial condition and get your church going.— L. Ron Hubbard, Ability, September 1955, 
According to the Church of Scientology, Field Auditors usually make a significant amount of their income from 15% FSM (Field Staff Member) Commissions. This is from referring their preclears to nearby (larger) Class V orgs or to the Sea Orgs for advanced training and processing.
Here is an example: You send your preclear into a nearby org, and she buys an Academy Training package for $8,000. You receive a 15% commission on those services, which is payable when she arrives at the Org to do them, ($1,200.00).
If you were to send 20 preclears a year into the org for similar packages, you would have $24,000 in income just from selecting your public to train.
Field Auditors also charge for auditing services, which the Church of Scientology says can also generate significant income:
You can make a very good living with as few as 3 paying preclears a week — though you will soon have many more. Just look at the chart below.
You audit two preclears for the IAS rate of $3,200* for a 121⁄2 hour intensive. You pay 10% to IHELP, which gives you 90%.
That's $5,760 income for 1 week.
You audit three preclears for the IAS rate of $3,200* for a 121⁄2 hour intensive. You pay 10% to IHELP, which gives you 90%.
That's $8,640 income for 1 week.
*a 121⁄2 hr intensive at a Class V Org costs $4,000. With a 20% IAS discount, it is $3,200.
- World Institute of Scientology Enterprises
- Hubbard College of Administration International
- Sterling Management Systems
- List of Scientology organizations
- Scientology status by country
- Symbols of Scientology
- "What is Scientology?". Retrieved 2008-01-15.
- Beit-Hallahmi, Benjamin (September 2003). "Scientology: Religion or racket?" (PDF). Marburg Journal of Religion 8 (1): 1–56. Retrieved 16 January 2013.
- Kent, Stephen A. (July 1999). "Scientology – Is this a Religion?" (PDF). Marburg Journal of Religion 4 (1): 1–23. Retrieved March 3, 2013.
- "the Federal Supreme Administrative Court decided that an association does not maintain a commercial business operation, if it offers services to its members in the realization of its idealistic purpose" Mission Neue Bruecke Stuttgart vs State of Baden-Wuerttemberg http://www.cesnur.org/testi/stuttgart_en.htm
- Behar, Richard (1991-05-06). "The Thriving Cult of Greed and Power". Time.
- "Auditing as a Career". American Saint Hill Organization, Church of Scientology. Archived from the original on 2006-08-18. Retrieved 2006-08-05.
- Sappell, Joel; Welkos, Robert W. (1990-06-24). "The Man In Control". Los Angeles Times. p. A41:4. Retrieved 2006-06-06.
- Cooper, Paulette Scandal of Scientology, Chapter 19, Tower Publications, NYC, 1971
- L. Ron Hubbard OEC Vol 4 page 411
- "Chilling Effects Clearinghouse Database". Chilling Effects Clearinghouse. Retrieved 2007-09-01.
- Kennedy, Dominic (2007-06-23). "'Church' that yearns for respectability - Scientology is trying to transform its image from that of a shadowy cult". The Times. Retrieved 2007-07-31.
- Shermer, Michael (2011). "Is Scientology a Cult?". Skeptic 17 (1).
- Understanding the German View of Scientology German Embassy, Washington, D.C.
- Reitman, Janet (5 July 2011). Inside Scientology: The Story of America's Most Secretive Religion. Houghton Mifflin Harcourt. ISBN 978-0-618-88302-8. Retrieved 20 December 2012.
- Hugh B. Urban (21 August 2011). The Church of Scientology: A History of a New Religion. Princeton University Press. p. 217. ISBN 978-0-691-14608-9. Retrieved 16 January 2013.
- Rich, Leigh E. (2012). "Book Review. The Church of Scientology: A History of a New Religion". Journal of Bioethical Inquiry.
- Shermer, Michael (Nov 2011). "The Real Science behind Scientology". Scientific American 305 (5). Retrieved 16 January 2013.
So did its founder, writer L. Ron Hubbard, just make it all up--as legend has it--to create a religion that was more lucrative than producing science fiction? Instead of printing the legend as fact, I recently interviewed the acclaimed science-fiction author Harlan Ellison, who told me he was at the birth of Scientology. At a meeting in New York City of a sci-fi writers' group called the Hydra Club, Hubbard was complaining to L. Sprague de Camp and the others about writing for a penny a word. "Lester del Rey then said half-jokingly, 'What you really ought to do is create a religion because it will be tax-free,' and at that point everyone in the room started chiming in with ideas for this new religion. So the idea was a Gestalt that Ron caught on to and assimilated the details. He then wrote it up as 'Dianetics: A New Science of the Mind' and sold it to John W. Campbell, Jr., who published it in Astounding Science Fiction in 1950."
- "The Story of Dianetics and Scientology" lecture 18 October 1958 by L. Ron Hubbard: And by 1938, I thought I had a common denominator to all life....So when I got out of the war...I collected my treasury checks and that was what financed the first of the research from which we benefit now. It's very funny but that was what financed it. I went right down in the middle of Hollywood, I rented an office, got ahold of a nurse, wrapped a towel around my head and became a Swami. And I said – oddly enough, I gave nobody my name, I didn't say what I was doing, and by 1947, I had achieved clearing."
- Sir John Foster, K.B.E., Q.C., M.P. (December 1971). "Enquiry into the Practice and Effects of Scientology" (PDF). Her Majesty's Stationery Office, London. Retrieved 2007-08-02.
- Enquiry into the Practice and Effects of Scientology, Report by Sir John Foster, K.B.E., Q.C., M.P., Published by Her Majesty's Stationery Office, London December 1971. Cited at http://www.cs.cmu.edu/~dst/Cowen/audit/fosthome.html .
- Behar, Richard (1986-10-27). "The prophet and profits of Scientology". Forbes 400 (Forbes).
Altogether, FORBES can total up at least $200 million gathered in Hubbard's name through 1982. There may well have been much more.
- Smith, L. Christopher (December 2008). "Scientology's Money Trail: Celebrities! Tax shelters! Bart Simpson! A glimpse into the finances of the secretive church". Condé Nast Portfolio (2008 Condé Nast Inc). Retrieved 2008-11-19.