Iowa credit union op-ed urges action in preserving the credit union tax status
Outreach on preserving the credit union tax status hit the local paper in Ames, Iowa this week, raising awareness and urging Iowans to take action in telling lawmakers “Don’t Tax My Credit Union.”
“We must preserve financial choice for Iowans,” said Greater Iowa Credit Union President/CEO Scott Zahnle in his op-ed in the Ames Tribune.
More than 1.5 million Iowans, including the 113,000+ credit union members living in Iowa’s 4thCongressional District, rely on credit unions for people-first financial services. Rep. Randy Feenstra, R, represents the district and serves on the House Ways and Means Committee, which is writing tax reform legislation in the next few weeks.
Zahnle’s op-ed warns that the credit union difference is at risk as Congress considers tax reform, explaining that “unlike big banks, which prioritize profits for shareholders, credit unions are not-for-profit financial cooperatives owned by and operated for the benefit of their members.”
He pushed back on the banking industry’s efforts to put a new tax on credit unions – which would be a new tax on credit union members. “While credit unions already pay a range of federal, state, and local taxes, we are exempt from federal income tax because we are cooperatively owned and reinvest our earnings into our members and the communities we serve,” Zahnle says. “As a result, credit unions like Greater Iowa Credit Union offer lower fees, better loan terms, and higher rates on savings than for-profit banks. In fact, credit unions save Iowans over $142 million annually versus the fees they would pay at a bank.” This is far greater, he points out, than the $35 million credit unions would pay if they were taxed like banks.
“As cooperatively owned institutions, credit unions succeed when people come together,” Zahnle said. “Now, more than ever, we must unite to protect credit unions as a vital financial partner.”
Credit union advocates across the country are encouraged to take action by writing lawmakers. Writing op-eds and letters to the editor in their local news outlets is another way to make an impact. The Member Activation Program’s Don’t Tax My Credit Union resources includes sample outreach.