Taxpayers and consumers, beware:
Legislation pending in capitol would increase taxes on credit unions and consumers.
WASHINGTON – With President Bush in the White House, tax hikes at the federal level are completely off the policy table – only over his \’dead body\’ would Congress raise taxes.
But at the state level, tax-hiking legislation is ubiquitous, and this trend, sadly, has reached Des Moines. Under the guise of "tax equity," politicians in the state house and senate introduced on Tuesday House File 388 and Senate File 242, which would impose a five percent tax increase on a credit union\’s equity during a taxable year. The bill would apply to Iowa credit unions meeting all three of the following criteria: 1) assets greater than $150 million; 2) community chartered; and 3) providing member business loans.
"Under the guise of \’tax equity,\’ the Iowa legislature is pushing for a tax hike on credit unions and consumers," said taxpayer advocate Grover Norquist, who heads Americans for Tax Reform (ATR) in Washington. ATR is widely considered the most influential taxpayer advocacy organization in the country.
The legislation purports to promote tax equity between banks and credit unions by imposing the tax hike. But true tax equity can be achieved by cutting taxes on banks – rather than hiking the tax on credit unions.
"This bill is nothing more than a stealth tax hike by tax-and-spend legislators," continued Norquist. "If politicians really wanted an equitable tax system, they would reform the laws pertaining to banks and credit unions throughout the state – not single out specific lenders for a tax hike. Reform is crucial, but tax hikes never are," he concluded.