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New Hampshire CU makes case vs. states BET
MANCHESTER, N.H. (7/21/10)--A New Hampshire credit union believes the state’s Department of Revenue Administration should not ask credit unions to pay back business enterprise taxes (BET), according to a Tuesday editorial in Foster’s Daily Democrat. The New Hampshire Credit Union League concurs. “Two recent cases make the point of just how far the state is willing to stretch common sense and credulity in its quest to close a multimillion dollar budget gap,” said Foster’s Daily Democrat. “Last month the Department of Revenue Administration notified several credit unions they may need to pay back business enterprise taxes. The state argues that the dividends credit unions pay to members are really interest payments and therefore subject to taxation under the BET.” The paper mentioned how Michael L’Ecuyer, president/CEO of Bellwether Community CU in Manchester, highlighted the weakness of the state’s BET position. “L’Ecuyer noted that the BET has been in place since 1993 without the state trying to collect the tax,” the paper wrote. “That’s nearly two decades late to the dinner table for anyone from [the Department of Revenue Administration] who has trouble with math. In addition, L’Ecuyer's credit union has used three different audit firms that never interpreted the law in this manner.” The New Hampshire league agreed. “The Business Enterprise Tax was never applied to credit union dividends because the legislature specifically excluded credit union dividends from this tax in 1993 when the legislation was written,” Dan Egan, president of the New Hampshire and Massachusetts credit union leagues and the Credit Union Association of Rhode Island, told News Now. “We are working with legal counsel to make this clear to the Department of Revenue Administration.” To read the editorial, use the link.
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