Pennsylvania High Court to Hear CU Tax Challenge

HARRISBURG, Pa. – The Pennsylvania Supreme Court has agreed to review the bankers’ challenges to community charters granted TruMark Financial CU and Freedom CU, two of the broadest fields of membership ever granted. The two community grants, both encompassing more than five million residents in five counties surrounding Philadelphia, were approved by the Pennsylvania Banking Department and upheld last year by the appeals panel, the Commonwealth Court. The state’s High Court is scheduled to hear oral arguments May 14 in a related case in which the bakers are challenging the tax exemption for state chartered credit unions, an issue that was brought out in the FOM cases. The case could have severe ramifications for credit unions, as the Pennsylvania Department of Revenue, one of the defendants in the suit, estimates that the tax exemption saves credit unions as much as $20 million a year in corporate and other state levies.