This is a wikipedia entry but gives a general idea how the Church is funded by state in several European countries. I especially liked the Italian model where the tax payer can decide to which group his tax amount must go and they have an Italian Buddhist Union and an Italian Hindu Union as some options that a tax payer may contribute too. Pleasantly surprised! Perhaps India should have similar model instead of robbing from Hindu temples alone - make the tax payer contribute some amount and let the amount be used for the religious body of his/her choice. Church tax Germany About 70% of church revenues come from church tax. This is about â‚¬9.2 billion (in 2010).Article 137 of the Weimar Constitution of 1919 and article 140 of the German Basic Law of 1949 are the legal basis for this practice. In Germany, on the basis of tax regulations passed by the communities and within the limits set by state laws, communities may either require the taxation authorities of the state to collect the fees from the members on the basis of income tax assessment (then, the authorities withhold a collection fee), or choose to collect the church tax themselves. In the first case, membership in the community is entered onto a tax document (Lohnsteuerkarte) which employees must surrender to their employers for the purpose of withholding tax on paid income. If membership in a tax-collecting religious community is entered on the document, the employer must withhold church tax prepayments from the income of the employee in addition to other tax prepayments. In connection with the final annual income tax assessment, the state revenue authorities also finally assess the church tax owed. In the case of self-employed persons or of unemployed taxpayers, state revenue authorities collect prepayments on the church tax together with prepayments on the income tax. If, however, religious communities choose to collect church tax themselves, they may demand that the tax authorities reveal taxation data of their members to calculate the contributions and prepayments owed. In particular, some smaller communities (e.g. the Jewish Community of Berlin) choose to collect taxes themselves to save collection fees the government would charge otherwise. Collection of church tax may be used to cover any church-related expenses such as founding institutions and foundations or paying ministers. Denmark The members of national Church of Denmark pay a church tax, which varies between municipalities, but can be as large as 1.51%. The tax is generally in the vicinity of 1% of the taxable income. The tax doesn't cover the entire budget of the church. An additional 13% is paid by the government.This means even people who are not members of the church finance the church through taxes. Sweden The members of Church of Sweden pay church fee, which varies between municipalities, but can be as much as 2%. Church and state are separated as of 2000, however the burial tax (begravningsavgift) is paid by everyone regardless of membership. In a recent development, the Swedish government has agreed to continue collecting from individual taxpayers the annual payment that has always gone to the church. But now the fee will be an optional checkoff box on the tax return. The government will allocate the money collected to Catholic, Muslim, Jewish and other faiths as well as the Lutherans, with each taxpayer directing where his or her taxes should go. It is possible to leave the church with the help of a web page Austria Church tax is compulsory for Catholics in Austria, with a rate of 1.1%. This tax was introduced by Hitler. After World War II, the tax was retained in order to keep the Church independent of political powers. Switzerland There is no official state church in Switzerland. However, all the 26 cantons (states) financially support at least one of the three traditional denominations â€“ Roman Catholic, Old Catholic (in Switzerland Christ Catholic), or Evangelical Reformed â€“ with funds collected through taxation. Each canton has its own regulations regarding the relationship between church and state. In some cantons, the church tax (up to 2.3%) is voluntary but in others an individual who chooses not to contribute to church tax may formally have to leave the church. In some cantons private companies are unable to avoid payment of the church tax Finland All members of either the Evangelical Lutheran Church of Finland and the Finnish Orthodox Church (the two state churches of Finland) pay an income-based church tax of between 1% and 2%, depending on the municipality. On average the tax is about 1.3%. Formerly, to stop paying church tax, one had to formally leave the church by personally going to local register office and waiting during an allowance of time for reflection. This requirement was removed in 2003 and currently a written (but not signed) statement to the church suffices. The majority of resignations since 2005 are now handled through a web site, Eroakirkosta.fi. If one is member of church when year begins, he/she will pay taxes for the whole year; however, these are later returned as a tax refund. In addition to personal taxation, the state divides some of the money collected by taxing private companies to the two state churches. It does not matter if company is owned by church members or non-members. It has been argued that the churches use this money to upkeep cemeteries, to which they are obligated by law. Switzerland There is no official state church in Switzerland. However, all the 26 cantons (states) financially support at least one of the three traditional denominations â€“ Roman Catholic, Old Catholic (in Switzerland Christ Catholic), or Evangelical Reformed â€“ with funds collected through taxation. Each canton has its own regulations regarding the relationship between church and state. In some cantons, the church tax (up to 2.3%) is voluntary but in others an individual who chooses not to contribute to church tax may formally have to leave the church. In some cantons private companies are unable to avoid payment of the church tax Iceland Taxpayers in Iceland are obligated to pay a congregation tax (Icelandic sÃ³knargjÃ¶ld) to the recognized religious organization of their choice. Those who do not belong to any recognized religious organization pay the same amount to the State. The Church of Iceland receives governmental support beyond the congregation taxes paid by its members Italy Taxpayers in Italy are obligated to pay the so-called eight per thousand tax. This tax amounts to 0.8% of the total income tax (IRPEF) and every taxpayer can choose on their tax form the recipient of the contribution. Currently the choices are The State Catholic Church Tavola Valdese Unione Italiana delle Chiese Avventiste del Settimo Giorno Assemblee di Dio in Italia Union of the Jewish Communities in Italy (Unione delle comunitÃ ebraiche italiane) Lutheran Evangelical Church (Chiesa Evangelica Luterana in Italia) Evangelical Christian Baptist Union of Italy Sacred Orthodox Archdiocese of Italy and Exarchate for Southern Europe Apostolic Church in Italy (Pentecostal) Italian Buddhist Union Italian Hindu Union If the choice is not expressly declared in the tax form, the tax is distributed according to the percentages of the taxpayers who have declared their choice of beneficiary. While it was intended that the State should use its own share of the 0.8% tax for social or cultural purposes, it has in practice employed it for general purposes, including its military mission in Iraq in 2004 and the upgrading of prison infrastructure in 2011.