| Frustrated by the unwillingness of House or Senate Republicans to eliminate the credit union tax exemption in either of their tax reform bills, the Independent Community Bankers of America is trying to drum up local support while the issue is hot.
The ICBA last week drafted a boilerplate op-ed blasting the credit union tax exemption, and the National Credit Union Administration for its recent comments, suggesting policymakers eliminate federal laws that limits membership in credit unions to local communities in favor of “very broad” definitions that could include online communities.
The ICBA is encouraging its members to submit the op-ed to local media outlets.
“It’s time to put an end to the credit union free ride and power grab,” the op-ed states. “If credit unions want to act like banks and serve virtually all Americans, including online communities, they should become banks and adhere to the same rules and guidelines that govern taxpaying institutions.”
“In truth, today’s credit unions are nearly indistinguishable from traditional banks, yet siphon top-performing small-business loans away from community banks by leveraging their tax-exempt status,” the op-ed also states. “Keeping these costly and outdated subsidies out of our federal tax code would provide for a fairer financial marketplace that ensures taxpayer dollars aren’t used to tip the scales.”
The argument over the credit union tax exemption is of course nothing new, and is just as big of an issue for credit unions as it is for banks.
“NAFCU and our members thank Chairman [Orrin] Hatch and Senate Republican leaders for recognizing that altering the tax status of credit unions would have a devastating impact not only on credit union members across the country, but also on consumers and small businesses,” Dan Berger, president and CEO of the National Association of Federally-Insured Credit Unions, said in a statement following the release of the Senate Republicans version of the bill.
