WASHINGTON (9/16/13)--Grassroots efforts by credit unions have resulted in members of Congress from New Jersey and West Virginia adding their voices to the growing chorus singing: Don't Tax My Credit Union.
For an example of how one credit union representative attending a Town Hall meeting brought up the issue of preserving credit unions' tax status--and U.S. Rep. Bill Pascrell's (D-N.J.) pro-credit union response--use the link to the C-span video.
In the video, XCEL FCU Director of Marketing Tom Quigley during a question-and-answer period at Pascrell's meeting told the congressman that "XCEL has 18,000 members and there are about are 1.3 million credit union members in New Jersey." He noted credit unions are trying to preserve their status, "and we're looking for your support" to maintain their exempt status "or we are literally out of business."
"Not every tax exemption is a loophole; some have to fight for it," said Pascrell, who is a member of the House Ways and Means Committee, which is drafting the tax reform law. "If you do away with certain deductions, that is like a having a tax increase," he said, comparing credit unions' tax deduction to deductions for charity contributions, mortgage interest deductions and more.
"These are all under attack right now. What we should be attacking is the loopholes that exist in the law so people can put their money offshore and you and I have to pay more taxes...I want to do as much as I can to stop that immediately and will do everything in my power to do so," said Pascrell.
"Credit unions do a terrific job; they're not competition with the banks; they're the competition that we need so that people can make good choices," adding that he favors reducing corporate taxes. "You have my word on that. In fact I'm on that legislation that will keep that deduction."
The West Virginia Credit Union League, which was hiking the Hill in Washington, D.C., last week, garnered the support of two members of Congress: U.S. Sen. Joe Manchin III (D-W.Va.) and U.S. Rep. Nick Rahall (D-W.Va.).
In a letter to the league Friday, Manchin wrote, "I have heard from many credit unions in West Virginia that share your concerns about potential changes to the federal corporate income tax exemption for credit unions. A repeal or scaling back of this exemption, which has been in place for nearly 100 years, has been mentioned as one of the countless proposals to address our unsustainable federal deficit. As our national debt approaches $17 trillion, I believe that we must cut spending, fix our broken tax system, and reform entitlement programs in order to reduce our debt and provide the economy with certainty and stability.
"However," Manchin continued, "it's essential that we remember that credit unions have always operated on a not-for-profit basis, and they serve as the backbone of communities throughout West Virginia and the United States. As a credit union member myself, I know that credit unions already pay a number of taxes, including payroll and property taxes, and that repealing this exemption could have a significant impact on credit unions and their communities."
He added that a common sense environment is needed, and that he would be "very mindful of your concerns should I have the opportunity to vote on this proposal in the future."
League President Ken Watts also noted that during a luncheon with Rep. Rahall that the congressman "expressed his strong support for credit unions and stated his interest in allowing the credit union tax exemption to remain intact."
For more on grassroots activity, go to a related story, Hike the Hill Visits Backed Online Advocacy Efforts Last Week, in today's News Now.