Presidential Tax Report Recommends Taxing CUs
A report from the Presidential Economic Recovery Advisory Board on simplifying the tax system has included a recommendation to tax credit unions.
The board is an "outside advisory panel" that was charged with making recommendations for changes in the current tax system "to achieve three broad goals: simplifying the tax system, improving taxpayer compliance with existing tax laws, and reforming the corporate tax system," the report said.
The report included the recommendation as part of its set of overall suggestions on how to reform the corporate tax system. Reports in previous administrations have made similar recommendations.
"Unlike other financial institutions like banks and thrifts, credit unions do not pay corporate taxes on their income," the report said. "This puts them at a competitive advantage relative to other financial institutions for tax reasons. Eliminating this exemption would raise revenue and level the playing field, but would clearly raise taxes on credit unions."