Credit unions save consumers $16 billion per year, according to a new study from the National Association of Federally-Insured Credit Unions highlighting the importance of the CU tax exemption.
“This study is more proof of what we already know: The credit union industry is a vital component of the nation’s economy, benefiting not only the more than 106 million credit union members but other consumers as well,” said Dan Berger, president and CEO of NAFCU. “Credit unions, as member-owned, not-for-profit institutions, are truly unique in their ability to serve members and their communities. We at NAFCU will remain vigilant in our fight to protect this industry’s ability to continue that work.”
A repeal of the credit union tax exemption is not currently under serious consideration, but the timing of the new report is notable, given that President Trump and his administration – backed by a Republican-controlled Congress – are looking for additional ways to boost government revenues and save taxpayers money.
The NAFCU-backed study was conducted by American University’s Robert M. Feinberg and Interindustry Economic Research Fund’s Douglas Meade. Some of the highlights include:
- Over the course of the 10 years examined in the study, credit unions saved consumers a total of $159 billion, or $16 billion per year through lower and fewer fees and lower interest rates on loans.
- If the credit union tax exemption was revoked, it would cost the federal government $38 billion in lost income tax revenue over a ten-year period, while GDP would be cut by $142 billion and nearly 900,000 jobs would be lost in that period.
- Total benefits to CU members from 2006-2015 (the period covered in the study) was estimated at $56.7 billion.
- Bank customers also benefited from credit union competition by an estimated $102.2 billion during the period covered by the study.
More information is available here.