Tax Battle: Banks on Offensive Against Credit Unions


Congressional lawmakers currently working on tax reform are caught in a war of words between banks and credit unions.

At issue is the longtime federal tax exemption for credit unions: The credit unions want to keep it, while the banking industry wants it to end.

“Credit unions offer the same products as banks, and yet they get a tax exemption that costs taxpayers $2 billion a year,” said James Ballentine, chief lobbyist for the American Bankers Association, an industry trade group.

“It’s just fairness for the banking community and the taxpayers to stop the exemption,” he said.

The ABA has been pushing to end the tax exemption for years, but in the past few weeks, with tax reform talks on Capitol Hill, it has stepped up its efforts with lawmakers to include a media blitz of radio and print ads in the Washington, D.C., area.

(Read moreBig bank bashers see first unintended consequences)

“We’re doing all we can to educate Congress on the issue,” Ballentine said.

‘We don’t want to be like them’

So too are the credit unions.

“We’re dealing with his head-on and getting our message out,” said Dan Berger, president and CEO of the National Association of Federal Credit Unions, which is spearheading an email and call-in effort to lawmakers this week.

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