New Bankers Group Seeks To Divide CUMovement

Register now

WASHINGTON - (05/05/05) -- A group recently chartered by theUtah banks has begun lobbying the President's Advisory Panel on TaxReform to divide the credit union movement into taxable andnon-taxable institutions. The Council for Sound Tax Policy, whichwas founded by Zions Bank and other Utah banks, called on the taxreform panel Wednesday to repeal the federal income tax exemptionfor credit unions over $100 million in assets and having broadmembership eligibility or significant business loan operations."It's time to stop discussing whether large, bank-like creditunions should pay taxes, but instead, discuss which credit unionsshould pay taxes," said Hugh Matheson, president of thebank-sponsored group. The proposal is similar to one the Utahbankers lobbied unsuccessfully to get the state legislature toadopt in 2003, which prompted all of the state's largest creditunions to flee the state charter for the tax-exempt shield of thefederal charter. Group representatives have been traveling aroundthe country to share their plan with bankers in Oklahoma,California and other states in an effort to spread its initiative.John McKechnie, chief lobbyist, acknowledged the derivation of thegroup and its long-sought goals, calling it "bought lock, stock andbarrel by the banks."

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER