CUNA sent its latest graphic combating banker falsehoods to Capitol Hill Wednesday, setting the record straight about large credit unions and the credit union tax status. CUNA sent two previous communications to Congressional staffers in recent week, all aimed at providing the truth behind banker attacks.
In response to the claim that large credit unions disproportionately benefit from the credit union tax status, CUNA noted that, by definition, any group of large entities—including large banks—benefit disproportionately when policymakers bestow certain policies on companies of various sizes.
“That’s simply a function of the fact that large companies generate substantially more income than smaller companies,” CUNA wrote.
CUNA also highlighted that 57 U.S. banks, representing only 1% total of all U.S. banks, account for 74% of bank profits. Those banks received an approximate $17 billion reduction in income taxes due to the 2017 tax reform bill, while all other banks (5,622 institutions) received an approximate reduction of only $6 billion.
“By contrast, the credit union tax status will total less than $2 billion for ALL U.S. credit unions in 2018,” CUNA wrote.
CUNA also wrote that the credit union tax status doesn’t appear to have any impact on the banking industry, as banks continue to report a 93% market share of financial institution assets.
“Moreover, all of the credit union tax benefits are passed on to members in the form of higher yields on deposits and lower fees and rates on loans,” CUNA wrote. “By contrast, a substantial proportion of bank tax savings are passed through to stockholders and employees.”