ICBA News Release
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Camden R. Fine
ICBA President and CEO
ICBA Federal Tax Policy Director
FOR IMMEDIATE RELEASE
As Tax Day Arrives, $655 Billion Credit Union Industry Still Exempt
Washington, D.C. (April 15, 2005) - As more than 230 million Americans dutifully pay their income tax bill and file their tax forms with the IRS, a rapidly growing $655 billion credit union industry will not pay one thin dime in federal income tax. Giant bank-like credit unions won't be filing tax returns-despite the fact that their direct competitors, thousands of community banks, will.
According to the latest independent research, the non-partisan Tax Foundation estimates the credit union industry will escape $31 billion in federal taxes over the next 10 years (see www.taxfoundation.org). Worse yet, a growing body of highly regarded reports by the Congressional Budget Office, the General Accountability Office, the Tax Foundation and others indicate that there is little or no evidence credit unions are better serving the financial needs of low- and moderate-income individuals despite their special tax-exempt status.
"Today more than 100 mega-credit unions each have $1 billion or more in assets," said Independent Community Bankers of America Chairman David E. Hayes, president of Security Bank in Dyersburg, Tenn. "These institutions often supply wealthy and middle-income members with financial services, offer a wide range of sophisticated banking products, and compete directly and aggressively against taxpaying community banks. Yet these same institutions don't pay taxes and don't bear the same regulatory burden as community banks."
Especially on tax day, it's fitting that policymakers take a fresh look at today's $655 billion credit union industry and its $31 billion tax subsidy and remedy the tax policy inequities in relation to millions of taxpaying individuals and small businesses throughout America.