Tax-reform is a revolving issue in Washington, and Credit Unions are once again defending financial choice. The main argument for taxing credit unions has been “oh, well they are just like banks!” Which is true when you think about the similar products that both banks and credit unions offer. But the biggest distinction that cannot be denied is that credit unions are not-for-profit entities owned and governed by their membership. That means 96 million members of credit unions profit every day in the form of better returns on savings, reduced rates on loans and lower or no fees on services.
“If credit unions lost their tax exemption, it would be an obstruction to the consumer’s freedom of financial choice,” said Gary Hinrichs, CEO of West Community Credit Union. “That’s why our advocacy is paramount in the fight to have an alternative to traditional banking.”
The truth of the matter is that for every $1 in new taxes to credit unions, $10 in member benefits would be wiped out. Also, by eliminating the competition of credit union rates, imagine how expensive other lenders could get.
Credit Unions were created to provide financial services in a democratic, not-for-profit, cooperative manner, and those characteristics are the foundation of tax exemption. In this way, they should be maintained and protected. And you can help!
“Credit unions and their advocates must stand up for policy in support of sustaining ourselves,” said Hinrichs. “We function for the sole purpose of providing service to our members and we, as a collective, aim to continue growing and standing the test of time.”
Write to congress and speak out for yourself. #DontTaxMyCU
