DES MOINES, Iowa (AP) — Iowa bankers have launched an advertising campaign calling for an end to credit unions' nonprofit status, which they say gives an unfair competitive advantage.
The move comes as Iowa's credit unions increase their market share.
The Iowa Bankers Association has released digital, radio and television ads pushing for a leveled playing field between for-profit banks and nonprofit credit unions, the Des Moines Register reported . The association wants banks' 5 percent franchise tax on profits to also be levied on the state's credit unions.
One of the ads calls for an end to "the credit union industry's free ride."
"We have a real opportunity here to address this issue and protect Iowa taxpayers," said John Sorensen, president and CEO of the Iowa Bankers Association.
Credit unions said they should remain exempt from the state's bank taxes.
Justin Hupfer, vice president of government affairs for the Iowa Credit Union League, said that banks are growing nervous because the state's credit unions are gaining market share.
"Banks want to get rid of credit unions, is the short of it," said Hupfer.
The Iowa Credit Union League is preparing to oppose any potential tax reform bill in the Legislature, Hupfer said.
Republican Rep. Guy Vander Linden said he'd rather lower taxes for banks than levy new taxes on credit unions.
"I tend to agree with their thought that they're working on an unlevel playing field, especially for the large credit unions," said Vander Linden. "They've gotten a tax advantage that allows them to be more competitive against banks. However, I am not interested in raising anybody's taxes."
Vander Linden said that this session's tax reform debate could bring the issue to the table.
"I think it's more likely," he said. "That doesn't necessarily mean it's going to result in any action."
- Iowa banks launch campaign against credit unions
- My Money - Differences between a bank and a credit union
- Father, son plead guilty to robbing Iowa credit unions
- My Money Monday, Feb. 19 - What makes a credit union different from a bank?
- My Money - The difference between a bank and a credit union
- AARP launches campaign to protect veterans
- Bernie Sanders launches second presidential campaign
- Former Pennsylvania Congressman launches Presidential campaign
- Discussion on changes to credit unions not-for-profit status
- No preregistration for Iowa union elections