Credit unions escaped mention in a proposed framework for corporate tax reform released by the White House and Treasury on February 22. The 25-page plan calls for making a wide range of corporate tax law changes in order to lower the overall corporate tax rate across the board to 28% from 35%. While credit unions are not mentioned specifically, the Administration’s plan does speak broadly of starting “from a presumption that we should eliminate all tax expenditures for specific industries, with the few exceptions that are critical to broader growth or fairness.” This marks the beginning of a process expected to run at least through the November elections.
“MCUA’s top legislative priority is the protection of the credit union tax status,” says Mike Beall, MCUA president/CEO. “MCUA has forcefully defended our position, and Congressman Todd Akin (R-District 2), a U.S. Senate candidate, is circulating a ‘Dear Colleague’ letter in support of the credit union tax status.”
A number of other industries were targeted in the plan such as oil and gas, insurance and those that use “last in, first out accounting.” However, the plan does reference a past Obama Administration report that considers the pros and cons of certain tax breaks, including credit unions’ tax exemption and Subchapter S, under which a number of banks receive tax benefits. CUNA will be meeting with officials at the Treasury Department very soon to clarify the intent of the reference.
CUNA has met with senior officials in the White House, at the U.S. Treasury and with key members of the tax-writing Senate Finance and House Ways & Means Committees to reiterate the fact that credit unions are essential to broad economic growth and fairness to consumers. According to CUNA, senior policymakers have been productive and have positioned credit unions well for the future deliberations to come.
Click here to read the 25-page framework for business tax reform.