Tax Foundation: Credit unions don’t deserve tax exemption

Credit unions do not deserve—and the U.S. cannot afford—the credit union tax exemption, Scott Hodge, president emeritus and senior policy advisor at the Tax Foundation, wrote in a scathing report issued this week.

“Fairness and equity demand that credit unions be put on the same tax footing as the banks they compete with,” Hodge wrote in a report titled “After 90 Years, it is Time to Wean Credit Unions Off Tax Subsidies,” and published by the Tax Foundation. He added, “In an era of $2 trillion deficits, subsidizing credit unions is a luxury taxpayers can no longer afford.”

The Tax Foundation, a conservative think tank, has criticized the credit union tax exemption for many years. However, in his new report, Hodge attacked the issue with added vitriol.

He wrote that regulators and lawmakers have permitted credit unions to behave like banks, so “equity, fairness and public finance” require that they be taxed like banks.

 

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