Washington, D.C (Feb. 21, 2018)—The Independent Community Bankers of America® (ICBA) asked Senate Finance Committee Chairman Orrin Hatch (R-Utah) to convene a hearing on the credit union industry’s tax exemption. In a letter to Sen. Hatch, ICBA said modern credit unions have failed in every aspect of their public mission and pose a threat to the American tax base.
“Today’s credit unions are virtually indistinguishable from taxpaying community and regional banks,” ICBA President and CEO Camden R. Fine wrote. “It is widely understood but rarely acknowledged that the tax exemption has outlived its purpose. Now is the time to have that discussion.”
ICBA’s request for a congressional hearing follows a letter from Sen. Hatch to the National Credit Union Administration expressing concern that credit unions may be operating beyond their tax-exempt purpose. The ICBA-supported letter noted that the credit union tax exemption is valued at approximately $2.9 billion this year. It also cited several NCUA actions that have helped the tax-exempt industry stray from its mission to serve people of modest means with a “common bond,” including rules relaxing field-of-membership constraints, lifting commercial lending limits, and opening the door to the use of outside investor capital.
ICBA and the nation’s community banks are united in their opposition to the credit union industry’s unwarranted federal tax subsidy as well as the NCUA’s attempts to drastically increase the powers of tax-exempt credit unions beyond their statutory limits.
The Independent Community Bankers of America®, the nation’s voice for nearly 5,700 community banks of all sizes and charter types, is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education and high-quality products and services. For more information, visit ICBA’s website at www.icba.org.