Ohio Credit Unions Safe for Now, New Taxes from General Assembly May Be a Concern Later

DUBLIN, Ohio – Nearly two months after the state required Ohio’s credit unions to charge members a sales tax on safe deposit boxes, the Ohio Credit Union League is cautiously optimistic about any new taxes. As bankers and elected officials in other states pressure legislatures to look to credit unions as a source of new revenue for ever-increasing budget deficits, Ohio’s 542 credit unions could be a prime target, said John Florian, OCUL’s chief operating officer. “We don’t see a specific threat yet, but based on what we’ve seen in other states, we want to alert credit unions that the threat of additional taxes is real,” Florian said. OCUL’s Board of Directors, the Ohio Charter Task Force and league staff are working on strategies should a tax threat materialize. Florian said any preparation the league engages in now would be to remind credit unions of the possibility of new taxes. “Ohio, like many other states, is facing a budget crisis,” Florian said. “We need to alert credit unions that threats might come from the Ohio General Assembly, not the bankers association. Right now, there’s nothing in the wind from the bankers.” Florian said reminding credit unions of the possibilities is a “balancing act” because while there is no real threat now, the league will still move forward with a defense campaign fund that will help counter any pro-tax bill introduction. “This is just a heads up for credit unions, we’re not asking for any donations right now,” Florian said. “We certainly don’t want to stir the waters with (the bankers’ association).” OCUL said credit unions in six states successfully fended off tax increases this year but a 50% supervisory fee increase passed the Illinois legislature. As a result, “credit unions must stay united,” said Jerry Guy, chair of the Ohio Charter Task Force. “We cannot risk falling game to the `divide and conquer’ strategy that as emerged in several states.” Meanwhile, Gov. Bob Taft recently signed an amended state budget bill here that would require Ohio credit unions to assess a sales tax on safe deposit boxes. Credit unions started assessing the sales tax on Aug. 1, with the tax ranging between 6.75% and 8% in some counties. Credit unions will be responsible for collecting sales tax based on the tax rate for the county where the business is located. In order to remit the sales tax, the credit union must pay $25 to the county auditor for a vendor’s license, if they don’t currently have one. -