May 16, 2023

NAFCU sets record straight on CU tax exemption

CapitolNAFCU Senior Vice President of Government Affairs Greg Mesack Monday wrote to Congress to set the record straight on the credit union tax exemption, noting that it allows credit unions “to reach out in areas banks couldn’t and serve those that banks wouldn’t.” Additionally, the association crafted a one-pager detailing how credit unions use their tax-exempt status to serve their members and communities.

In the letter, Mesack also remarked that concerns about the banking sector have caused “real questions about financial stability,” while credit unions continue to be consumers’ and small businesses’ best source of safe, secure, and reliable financial services at an affordable price.

Mesack pointed out that credit unions operate as mutually-owned financial cooperatives that put people over profits, while remaining accessible in regions where banks have closed branches. He also explained how the industry remains well capitalized with over 90 percent of deposits insured by the federal government.

“By every account this legislation has been an unparalleled success,” said Mesack. “Today, credit unions serve over 135 million Americans, and still stick to that basic mission of providing safe, affordable financial services products to Main Street America.”

NAFCU has made protecting the credit union tax exemption a top priority. The association commissioned an independent study in 2021, which revealed if the tax exemption was removed, America would lose $38 billion in tax revenue, $142 billion in GDP, and 900,000 jobs over the next 10 years.

NAFCU will continue to advocate for the long-standing credit union tax exemption.