Independent Lawmaker Sanders Speaks Out in Support of CUs' Tax Exempt Status

WASHINGTON-Congressman Bernie Sanders (I-Vt.) told his colleagues in the House recently that credit unions are “one of the most vital, one of the most democratic, institutions in America.” In a speech on the House floor May 17, Sanders explained, “Credit unions are cooperatively owned by those who deposit money in them, not by `investors’ who want to make a profit from loaning money. They are democratic, owned and run by their members. And anyone who makes a deposit is a member.” Sanders provided a brief history of credit unions and the movement to illustrate this point. “Without the need to make a profit, without heavy advertising costs, without huge bonus packages to corporate executives, credit unions can provide loans at rates lower than other financial institutions,” he said. “And they also can provide loans to those who might otherwise be turned away from conventional banking institutions.” Sanders noted his original sponsorship of the Credit Union Membership Access Act in 1998. Several years after the passage of that legislation, credit unions remain a strong force. They need to be strong for ordinary Americans who are struggling, he said. He noted that the for-profit financial services sector has left many behind. “Yet even though credit unions serve 70 million people – perhaps because they serve 70 million people – they are under attack by the for-profit financial establishment,” Sanders stated. He continued, “Credit unions are tax-exempt for good reasons, and not because anyone is doing them a special favor. Credit unions are tax-exempt because they are not-for-profit institutions. And under federal law, and rightly in my view, non-profits are exempt from taxes: churches, hospitals, libraries, universities -and credit unions.” “It is my belief,” he said, “that credit unions and their members have the potential to be an even more important economic, social and political force in our country in the decades ahead. In a nation facing forces that threaten to rip our economic well-being apart-downsizing, outsourcing, shipping jobs abroad-credit unions remind us that we can work together for the common good. They show us, day after day, that it is not necessary to incorporate the profit motive into every aspect of American life. In fact, credit unions show us how, if profits are not involved, people can come together to help themselves, sustain themselves, and create healthy communities.” [email protected]