A pair of ballot initiatives in Missouri that will directly impact credit unions were approved in voting yesterday.
Constitutional Amendment 2, which passed with 70% approval, prohibits credit unions and other business from contributing to political action committees (PACs) or candidates running for Missouri office. Insurance companies, banks and electric cooperatives are among the other groups that, along with credit unions, will not be allowed to make political donations to PACs or candidates, but the Heartland CU Association, which represents credit unions in Missouri and Kansas, noted that other businesses are unfairly excluded from the amendment, giving them a leg-up in the political arena in that state. The league said the amendment is intended to reform campaign finance laws in the Show-Me State, but critics of the measure have suggested certain parts of the amendment are unconstitutional. The initiative is expected to face legal challenges.
Constitutional Amendment 4, known as the Taxpayer Protection Amendment, was also approved with a 57% majority. The amendment protects consumers and businesses – including credit unions and banks – from state and local government imposing taxes on services. For financial institutions, that means services such as account transactions, teller fees, loan-servicing fees and more. Sales tax is applied to tangible goods in Missouri, but the state's General Assembly has proposed a sales tax on services for the last seven years.
"The passage of Amendment 4 is a positive for consumers in Missouri, who will not face additional taxation on services – including financial services," The Missouri league told Credit Union Journal. " Amendment 2 raises serious constitutional questions by prohibiting some groups from participating in political action committees, while still allowing others to do so. It is anticipated this will be challenged in the courts."
