Inside of the Rotunda at the U.S. Capitol in Washington, D.C. September 20, 2013. Photo by Diego M. Radzinschi/THE NATIONAL LAW JOURNAL.
The Independent Community Bankers of America (ICBA) is urging Congress to eliminate tax exemptions for credit unions with more than $1 billion in assets, citing unfair competitive advantages and increasing consolidation in the financial industry.
This is a marked change in the ICBA’s lobbying strategy over the past year, as they have called on lawmakers to remove the credit union tax-exempt status wholesale.
The ICBA introduced a new policy resolution at its ICBA LIVE 2025 national convention in Nashville this week, calling on lawmakers to either remove the federal tax exemption for large credit unions or establish tax parity between credit unions and tax-paying community banks.
“With credit union acquisitions of tax-paying community banks reaching a record high last year, the growing skepticism of credit unions’ tax and regulatory exemptions must evolve into policymaker action,” ICBA President/CEO Rebeca Romero Rainey said. “Eliminating the federal tax exemption for credit unions over $1 billion in assets will help ensure taxpayer dollars no longer tilt the competitive marketplace, subsidize community banking consolidation, and result in fewer choices for consumers and small businesses.”
NCUA data showed 451 of the nation's 4,550 credit unions had $1 billion or more in assets. They accounted for 77% of the movement's assets and 74% of members.
In a statement to CU Times, America's Credit Unions Chief Advocacy Officer Carrie Hunt said the ICBA is "grasping at straws" with this new policy.
“Credit unions at their core share the same mission – a cooperative financial institution to meet the needs of their fields of membership and communities," Hunt said. "Regardless of their size, credit unions meet their members where they are and work to uplift them, whether that's through a new service, type of loan or initiative. The industry’s tax status provided $234.6 billion in total benefits to American consumers over the last 10 years – more than $23 billion a year. A new tax on any credit union would be a tax on their members. ICBA’s new policy shows they are grasping at straws when credit unions step in and reinvest in their communities, which banks have left behind.”
The ICBA’s strategy and messaging shift was expected by America’s Credit Unions President/CEO Jim Nussle. Last month, he told Punchbowl News he wasn’t especially worried about the ICBA’s efforts because with the decline in the number of small banks, the ICBA has been “losing members hand over fist. Their voice is shrinking dramatically.”
The resolution from the ICBA followed increased scrutiny of credit union acquisitions of community banks. Last year, the FDIC issued a policy statement indicating that deals involving credit unions may require additional regulatory review.
Meanwhile, a recent ICBA-Morning Consult poll found that 62% of U.S. adults believe credit unions operating like banks should pay taxes like banks, and 62% support a congressional investigation into the credit union industry’s tax exemptions.
The ICBA’s policy resolutions will guide its advocacy efforts in 2025. The organization plans to work with the Trump administration and the 119th Congress to advance reforms outlined in its “Repair, Reform, and Thrive” plan, promoting a balanced financial services landscape, responsible regulation and financial system stability.
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Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
