Halloween has origins in Celtic and pagan rituals when people believed that Samhain (the Celtic name for Halloween, pronounced 'sow-ain') was a time when the veil between this world and the next was thinnest; therefore, communication and contact with spirits or the spiritual realm was strongest.
Rosemary Guiley states that Samhain "celebrates the beginning of winter, marked by death, and the beginning of the Celtic New Year.....(....)....Samhain is a time for taking inventory of life and getting rid of weaknesses and what is no longer desired," [__The Encyclopedia of Witches & Witchcraft__, 2nd ed., (NY, NY: Checkmark Books/Facts on File, p. 356)].
Halloween is one of the eight sacred or special days of celebration for many in the Pagan community. However, there is no evidence that any group uses this day as a day of sacrificing animals or people, and Christians therefore should not assume this nor believe wild stories about such practices, nor should Christians spread such stories. Christians need to remember the commandment about not bearing false witness. Pagan holidays are connected to the Pagans' reverence for nature and the seasonal changes; sometimes these beliefs incorporate and celebrate the stories of various pagan gods. And no matter what beliefs people hold, as Christians we are called on to respect all people because all men have been created in the image of God.
Christians should not buy into rumors that witches or Satanists are killing people or sacrificing them on this day. Christians should consider Halloween a good day to pray for those in the occult, that they would come to know the love and grace of Christ, and the forgiveness of sins through trusting Christ as the Savior who shed His blood on the cross for them. This is the message they need to hear in love.
As for trick-or-treating, that is up to the individual parent. Certainly, one hopes that Christians would not let their child dress up as a witch, demon, devil, ghost, or other figure that belongs to the world of death or the occult.
Churches can offer alternative celebrations, such as a harvest day, and invite the area children to come play games, have treats, and hear Bible stories.
Since Halloween is my birthday, I have a special concern for this day. It is ever a personal reminder to me of the passage of time, and a reminder of those in the occult who embrace darkness and need the Light of Christ.
Jesus read in the Temple these words from Isaiah 61: "'The Spirit of the Lord is on me, because he has anointed me to preach good news to the poor, He has sent me to proclaim freedom for the prisoners and recovery of sight for the blind, to release the oppressed, to proclaim the year of the Lord's favor.' Then he rolled up the scroll, gave it back to the attendant and sat down. The eyes of everyone in the synagogue were fastened on him, and he began by saying to them, 'Today this scripture is fulfilled in your hearing.'" (Luke 4:18-21; Jesus was the fulfillment of Isaiah's prophecy).
"For he has rescued us from the dominion of darkness and brought us into the Kingdom of the Son he loves, in whom we have redemption, the forgiveness of sins." (Colossians 1:13-14).