America’s Credit Unions President/CEO Jim Nussle wrote to the House Ways and Means Committee ahead of its Tuesday hearing with Treasury Secretary Janet Yellen. In the letter, Nussle called attention to the effectiveness of the Federal Credit Union (FCU) Act and urged the committee to protect credit unions’ tax-exempt status.
“The tax-exempt status afforded credit unions allowed them to reach out to areas banks could not and serve those that banks would not,” wrote Nussle. “By every account, this legislation has been an unparalleled success. Today, credit unions still stick to that basic mission of providing safe, affordable financial services products to Main Street America.”
He added that credit unions are member-focused and prioritize relationship banking due to their cooperative structure and common bonds. Nussle also highlighted the safety and soundness of the industry.
Additionally, Nussle pointed out that the federal tax exemption provided by the FCU Act does not mean credit unions pay no tax, as the industry pays roughly $25 billion in property, payroll, sales, and other taxes annually. He also emphasized the stability of credit unions compared to banks.
“Credit union managers don’t face stockholder pressure for maximum short-term profits. They also don’t have compensation packages that encourage risky market behavior. Thus, credit union managers avoid high-risk, higher return business practices. They also provide responsible loans and stable financial products to members,” he wrote.
Nussle also detailed the industry’s commitment to diversity, equity, and inclusion in both hiring and business practices.
Read the full letter. America’s Credit Unions will continue to engage lawmakers and work to protect the credit union tax exemption.
