IOWA NEWSPAPER ASSOCIATION
New Survey Shows Majority of Iowans Support Eliminating Tax Exemptions for Credit Unions and Farm Credit System
JOHNSTON, IOWA (Oct. 7, 2013) – With the growing federal deficit and federal tax reform solutions being much-discussed topics in Washington, D.C., independent research firm Victory Enterprises, Inc. surveyed Iowans from across the state Sept. 25-26 about their views on the current tax exemptions provided to credit unions and the Farm Credit System.
The survey found that a majority of Iowans (58 percent) were not aware that large credit unions, with billions in assets, are exempt from paying income taxes on their profits. The survey also found that even more (62 percent) were not aware that the Farm Credit System, a government-sponsored lender, pays no income tax on their profits from agricultural real estate loans.
Upon learning about the credit union exemption, the majority of survey respondents (55 percent) were in favor of eliminating it. Another 24 percent were not sure what to do about it, and only 21 percent supported keeping it.
The credit union industry is a $1 trillion industry with more than $2 billion in annual profits. Two Iowa credit unions are among the five largest financial institutions chartered in Iowa, and one is the most profitable financial institution based in Iowa. The Office of Management and Budget recently estimated the credit union tax exemption has cost Americans an estimated $20.5 billion in lost federal income taxes since 2001. This tax exemption ranks among the largest corporate tax loopholes in existence today.
The survey results were similar when Iowans were asked about the Farm Credit System tax exemption. Most respondents (49 percent) also were in favor of eliminating the income tax exemption for the Farm Credit, 21 percent were undecided about what to do, and only 30 percent supported keeping it.
The Farm Credit System is a $247 billion government-sponsored enterprise with more $4 billion in annual profits, up 4.5 percent from last year. It is estimated that their tax exemption will cost American taxpayers $6.44 billion over the next five years.
The impact of these exemptions on personal income taxes was also a concern among the Iowans surveyed. The majority of the survey respondents (55 percent) believed their personal income taxes were higher when other potential taxpayers, like credit unions and the Farm Credit System, enjoy significant tax exemptions on their profits.
The live telephone survey included a representative sample of 500 Iowans from across the state. Survey respondents included Republican, Democrat and No Party voters, as well as both credit union and bank customers. The margin of error for the survey was 4.38 percent at a 95 percent confidence level. The survey was conducted by Victory Enterprises, Inc. and sponsored by the Iowa Bankers Association.
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About Victory Enterprises
Victory Enterprises is an independent consulting and communications firm located in Davenport, Iowa Victory Enterprises has an in-house public polling division and conducts market research for associations and corporations across the country. Their survey research has been disseminated and carried by the media, including The New York Times, Washington Post, USA Today, Des Moines Register, Omaha World Herald and Quad City Times, to name a few.
About the Iowa Bankers Association
The Iowa Bankers Association represents 341 Iowa banks and savings institutions. Iowa bankers are committed to the Iowa values of honesty, hard work and community service, and have been a trusted resource for Iowans for more than 100 years. Iowa banks offer FDIC insurance and lend more than $43 billion to help individuals, business owners and agriculture. Nearly 15,000 Iowans work at an Iowa bank, and Iowa banks donate more than $35 million and 874,000 volunteer hours to support local communities each year. To learn more about Iowa banks, visit MyIowaBank.com.
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