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Bankers step up calls on Congress to examine CU tax exemption; CRA
Tuesday, March 5, 2019 6:50 AM

The Independent Community Bankers of America released its “Community Focus 2020” legislative agenda on Monday, singling out credit unions and the National Credit Union Administration for criticism and focusing on the credit union tax exemption and subjecting credit unions to the Community Reinvestment Act (CRA).

The CRA requires greater disclosure of credit union compensation and ensures that it is not difficult from a regulatory standpoint for a bank to acquire a credit union than for a credit union to acquire a bank.

ICBA contends that NCUA consistently pushes the envelope and acts as a cheerleader for the industry. “ICBA continues to oppose attempts by the NCUA to flout statutory limits and liberalize restrictions on fields of membership, member business lending, and issuing supplemental capital,” the group said.

Congress may or may not be willing to open the tax code for major changes, since they just completed a tax overhaul last year; however, it's possible Congress could make "technical corrections" to the bill that was enacted.

“Bankers have indicated they will not rest until the credit union tax exemption has been repealed,” said Cornerstone Credit Union League Chief Government Relations Officer Jim Phelps. “Their continued attacks reinforce the critical need for credit unions to ensure their legislators understand the credit union difference and the reasons the current tax status matters to 110 million members. The tax status and the Community Reinvestment Act will both be priorities for us when we visit Capitol Hill during the CUNA Governmental Affairs Conference.”