THE REV. Diane Kessler, executive director of the Massachusetts Council of Churches, is right on the money in noting that the bill filed by Senator Marion Walsh requiring financial reports by churches originated in an effort to enlist civil power on one side of an internal dispute within the Catholic Archdiocese over parish closings (''Bill would force church to disclose its finances," Page A1, Aug. 8). This is one solid reason why the bill should die in committee. Civil authority should move with extreme caution before taking sides in purely internal church matters.
The other solid reason why the bill should be scuttled is contained in Walsh's description of churches as charitable institutions that should be required to make financial reports, as do other charities chartered by the Commonwealth. The difficulty here is that churches do not receive their tax-exempt status because they are charities. The special tax treatment of churches is because they are churches and is not dependent on the nature and extent of their charitable expenditures.
FRANCIS M. McLAUGLIN