Across Louisiana, credit unions are a financial lifeline to over 1.3 million members — people from every walk of life who rely on these not-for-profit financial cooperatives for affordable services, personalized support and community-focused solutions. Our 144 credit unions serve communities from Shreveport to New Orleans and everywhere in between and employ more than 4,000 Louisianans. Yet, today, that is under threat.
As I write this, members of Congress are crafting a sweeping new tax bill — and there is growing concern that it could include damaging changes to the federal tax status of credit unions. This is an urgent moment for everyone in our state who values access to fair, member-first financial services. We must act now to protect Louisiana’s credit unions.
Credit unions are fundamentally different from banks. We are not-for-profit, member-owned cooperatives. That means every dollar a credit union makes is reinvested into its members — in the form of lower fees, better interest rates and investments in local communities. This structure has proved effective and resilient. During the Great Recession, far fewer credit unions failed compared to banks. During the pandemic, credit unions stepped up to support small businesses and families without the need for massive taxpayer bailouts.
Despite these clear distinctions, some banking groups are lobbying Congress to eliminate our tax-exempt status. Their argument? That we compete on an unfair playing field. But that couldn’t be further from the truth.
Credit unions do pay taxes. They pay a wide range of state and local taxes, such as property, sales and payroll taxes. However, they do not pay federal income tax on profits.
In Louisiana, in 2024:
- The average credit card interest rate for a credit union rewards card was 12.56% compared to 17.61% at a bank.
- The average savings rate on a checking account at a credit union was 1.11% compared to 0.11% at a bank.
Juan Fernandez
Taxing credit unions is a direct additional tax on consumers who already bear substantial tax burdens.
If credit unions were taxed, the revenue would only account for 0.04% of federal spending, funding the federal government operations for only 3.9 hours.
If Congress were to remove the credit union tax exemption, it wouldn’t be big banks that suffer — it would be middle-class Louisianans. Credit unions would be forced to raise fees, cut services and pull back from the very communities that need us most. That’s not fair. And it’s not what Congress promised when it granted credit unions their tax status more than a century ago: to ensure financial services for those who might otherwise be left behind.
I’m calling on every credit union member in Louisiana, and every citizen who believes in fair, accessible financial services, to contact your elected officials today. Tell them: Don’t tax my credit union. Ask them to oppose any effort to change the tax-exempt status of credit unions.
This isn’t just a fight for our institutions; it’s a fight for the financial well-being of more than a million Louisianans. Let’s make sure our voices are heard.