SDBA Wants Credit Union Tax Modification
by Brian Kirk, Meteorologist/Reporter
October 16, 2013 5:21 PM
The South Dakota Bankers Association held a press conference Wednesday announcing their efforts to raise awareness to what they claim is taxation inequality. The group says that credit unions are totally exempt from taxation, including federal income tax. These exemptions were granted in 1916 and 1937, and the bankers say they want to level the playing field, and that credit unions must pay more.
"The existing tax payers probably shouldn't be asked to pay any more, until the people who aren't paying any right now, or paying just a pittance , step up to the plate and pay their fair share," said Curtis Everson, the President of the SDBA.
The banking group says that credit unions have grown much further than imagined when the laws were passed. Everson insisted, "The longer the tax exemptions stay as they are, the larger the loss of revenue will become to federal, state and local treasuries."
With all the turmoil in Washington D.C., even with the government shutdown, the South Dakota Bankers Association wants Congress just to start to take a look at the tax exemptions that federal credit unions are given. Kevin Tetzlaff, Chairman of the SDBA, says that it is the credit unions that need to be fair. "Take a look at any rural thriving community, at the center of it you will likely find a local bank that has a vested interest in the community's success, yet Farm Credit Services and the credit unions are the financial institutions reaping the tax preferential treatment."
The credit unions aren't backing down, saying that these demands are being made by a group who has control of 94% of the market in total assets. Travis Kasten, the President of Service First Federal Credit Union says that there are distinct differences. "You can look at our models and our financials and ask our members, our model is simple, we are member owned, any income we make goes back to our membership, and we are made up and constructed of a board of directors that volunteer."
Even with the chaos on Capitol Hill, the fight for tax regulation is pushing on.