Taxing credit unions would "likely damage the overall economy" and not raise substantial revenue, two conservative organizations and a Hispanic advocacy group wrote a presidential panel.
New taxes "would threaten an already shaky depository system" and result in increased fees and lower interest rates at credit unions and their competitors, according to a letter to President Obama's Economic and Recovery Board from Americans for Tax Reform, The Heartland Institute and the League of United Latin American Citizens.
Although a tax would raise $1.5 billion, it represents only 1/10th of 1% of the Gross Domestic Product, according to the letter.
Last week, the board recommended considering lifting credit unions' tax-exempt status as one of the ways to raise revenue to reduce the federal deficit.
