Debt Debate Could Speed Tax Reform: Onsite Coverage
WASHINGTON — Optimism about saving the tax exemption was in the air at CUNA's “Don’t Tax My Credit Union” event at the Credit Union House the trade group held Wednesday in conjunction with its national online rally.
CUNA is working to garner support for its no tax message from the across the nation, hoping to get the attention of Congress. The public can write their members of Congress on the campaign’s website, which CUNA said has already recorded more than 1 million contacts.
As the battle over the federal budget continues in Congress amid a government shutdown, the deadline for raising the nation’s debt limit is fast approaching. CUNA told Credit Union Times that the debt ceiling debate could expedite tax reform.
“It’s going to be interesting to see how the government shutdown is resolved and when we get into the debt ceiling, if the House, as expected, includes tax instructions in that debt ceiling, there’s a possibility that there will be expedited consideration of tax reform and that could provide us some momentum to get things done,” said Ryan Donovan, CUNA’s senior vice president of legislative affairs.
John Magill, executive vice president of government affairs at CUNA, said he is optimistic about the passage of a tax reform bill before December 2014.
“You’ve got a Republican chairman and Democratic chairman saying on my watch, which is only for 14 more months, saying they’re going to report a bill,” Megill said.
“We don’t know if it’s going to be 10 weeks or 10 months, it’s not going to be 10 days but somewhere on down the line, there’s going to be tax reform. There has not been tax reform since 1986,” he added.
The American Bankers Association is lobbying Congress to repeal tax-exempt status for credit unions. The ABA recently wrote a letter to House Ways and Means Committee Chairman Dave Camp (R-Mich.) and Ranking Member Sander Levin (D-Mich.) asking them to support repeal.
“With large annual federal deficits, our country can no longer afford to subsidize the $1 trillion credit union industry, which increasingly operates like a tax-free banking system,” wrote Frank Keating, ABA President/CEO.
“The tax code should not be picking winners and losers, but that is exactly what the credit union tax exemption does. It has a particularly harsh impact on Main Street community banks. If tax reform is about the principle of making the tax code fairer, then Congress should end the corporate tax exemption for credit unions,” the letter also said.