Cold War Flavor to Verbal Battle over CU Taxation
Reosti, John, American Banker
Words to the wise banker, compliments of Credit Union National Association president Daniel A. Mica: pressing for the elimination of credit unions' tax exemption will backfire.
"They are trying to create a major showdown in Washington," Mr. Mica said in an interview earlier this month. "Taxation is the nuclear option. Do it, and you end credit unions as we know them today.
"It is not going to happen."
The way the former congressman from Florida sees it, Congress is never going to levy a tax on credit unions, and bankers are just wasting their time pushing for it.
Diane Casey-Landry, the president and CEO of America's Community Bankers, said Mr. Mica "is using inflammatory rhetoric" about credit union taxation in the hopes of diverting attention from the National Credit Union Administration's decision to block two Texas credit unions from converting to banks, even though members of both institutions voted overwhelmingly to approve the charter conversions.
"The issue of the day is not taxation, it is choice, and giving credit unions the freedom to choose what they want to be," Ms. Casey-Landry said in an interview Thursday. "People do not want to see their options limited or removed altogether."
Mr. Mica, however, said the issues were linked, and that the same "zealots" who are agitating for taxation of credit unions are leading the attack on the NCUA and its conversion policies.
"You've got these zealots who have always wanted to put credit unions out of business," he said. "If they can change the tax status, or convince credit unions to convert to banks, they will do that."
According to Mr. Mica, there is a silent majority of bankers who have no problem with credit unions, and he called on them to rein in those going after credit unions.
"I'm asking the saner, truly thoughtful bankers to tell the others to knock off this fight," he said. …