You ask a question that has a long history throughout the spread of the Christian faith into many cultures. The Lord tells us in his word that we should "not be conformed to this world, but be transformed by the renewing of your mind, that you may prove what is that good and acceptable and perfect will of God." (Romans 12:2) And, the background of this, as you might expect, is verse 1, where he says, "I beseech you therefore, brethren, by the mercies of God, that you present your bodies a living sacrifice, holy, acceptable to God, which is your reasonable service." It is clear, then, that we are not to live as people whose hope and life and joy is based upon what we find in this world, or what it offers us, for we have been bought with a price, the precious blood of Jesus, and we live for him, and seek to be conformed to him and his word.
The problem is, and for many years has been, how to integrate ourselves into the culture where we find ourselves, without giving up the goal of not being conformed to this world, but instead, being transformed by the renewing of our minds in Christ? The easiest answer is to completely withdraw, and many people have chosen this option. But, it's not the Lord's will for us. He says to his Father in John 17:15-19, "I do not pray that you should take them out of the world, but that you should keep them from the evil one. They are not of the world, just as I am not of the world. Sanctify them by your truth. Your word is truth. As you sent me into the world, I also have sent them into the world. And for their sakes I sanctify myself, that they also may be sanctified by the truth." But, I think that in addition to making it clear that we cannot withdraw from this world, these verses also tell us the positive alternative to conforming to this world, or withdrawing from it. That is, we are to be sanctified by the word of truth.
This doesn't give us an exact answer about how to implement our Christian faith, but it does help. Our goal should be to follow Christ. Some people can participate in Halloween celebrations, and do so to the glory of Christ, because they just consider the dressing up in costumes and asking for candy to be a cultural celebration, and in no way compromising the Gospel. Others consider it to be a compromise of the Gospel to do so, and an imitation of the world, which detracts from the Gospel, and so they cannot (and should not) participate in any celebration what would detract from following Him. Frankly, I can think of so many applications of this principle that I am reluctant to begin listing them, but, for example, going to parties, having a Christmas celebration, participating in political activities in the United States. All of these can be glorifying to God, but all can be offensive, if we are not careful to do so to the glory of God and the proclamation of the Gospel.
Perhaps one final note. As a church, we need to be careful not to force people to act against their consciences. If some in the church do not believe that we can dress in costumes and glorify God, then the church should refrain from having activities which require them to violate their consciences. But again, those who perhaps feel that the church has acted wrongly even in such a matter as this should understand that the exact application of this principle to be in the world and not of the world is not always as easy as we might wish, and not make a bigger issue of it than it is, but rather, seek for positive alternatives which would encourage the body of Christ.
There is much more that can be said about this, but, perhaps this is enough to begin, and if you wish to discuss it more, I am at your service in Jesus our Lord.
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