Democratic Group Offers CU Taxation Proposal
An influential group of Democratic Party policymakers issued its own proposal for tax reform last week that would, among other things, repeal the federal tax exemption for credit unions over $10 million in assets.
The proposal, issued by the Democratic Leadership Council made of lawmakers and activists in the Democratic Party, would broaden tax breaks for home loans, student loans and families by closing a number of loopholes and repealing certain exemptions, including the one for "large credit unions," which it defines as those over $10 million. The proposal would raise an estimated $1.5-billion a year in taxes from those credit unions, the group said.
The proposal is expected to attract little congressional support-Democratic presidential nominee John Kerry who wrote supporting the credit union exemption is a member of the DLC. Still, the credit union lobby has begun opposing the credit union provision. "We've already been in contact with certain members of the DLC and will be contacting other members," CUNA lobbyist Gary Kohn told The Credit Union Journal.
The DLC is a so-called centrist group of Democrats who gained prominence with its support of Bill Clinton before he was elected president, then as influential participants in the Clinton Administration. But it influence has waned considerably since the Clinton days, especially with the ascendance of Republicans to a majority in Congress and control of the White House. As a result, its recommendations are not expected to carry much weight in the current political climate.