Churches are not businesses that generally speaking do produce some form of expenditures but do not fundamentally produce direct income. Taxing churches and other religious and philosophical establishments would put many of the smaller ones out to pasture and violate the right to Freedom of Religion. It is imperative they remain untaxed so as not to further stress the burden of smaller entities.
Tax exempt status is a two edged sword that violates the right of the church to free speech. Pastors are not allowed the same right to free speech as other people. It would be better for churches to get rid of tax exempt status so the pastor can preach whatever he or she wants.