What is a Bank?
You might be surprised to learn a bank is a business like a beauty salon, hardware store, or convenience station. Banks, similar to other industries - like restaurants - must adhere to strict regulations. Like any company, banks that fail to make profits also go out of business.
Paying Income Tax
Banks also pay income tax just like other local businesses. Banks are important to the economy…but so is food. Farmers are taxed, and so are grocery stores. Imagine a profitable business that didn’t pay income tax – would that be fair? Think about your own employer – do they pay taxes? Do you?!
That’s why Luana Savings Bank, along with American Bankers Association, Iowa Bankers Association and hundreds of other local community banks oppose credit unions.
Community banks are just as committed as any other local business to the well-being of our neighbors. In fact, unlike other local businesses, banks are explicitly REQUIRED to make programs, donations, and certain loans available locally. Whether that’s fair or not, Luana Savings Bank is even further committed to seeing our local communities prosper and has electively built community centers – free of use. At the end of the day and the end of the week, we’re local – we live right alongside our customers.
Luana Savings Bank offers competitive rates and services as compared to credit unions. Yet we still pay much higher taxes, are required to comply with the Community Reinvestment Act, and willingly elect to build facilities for local community use. Excess credit union earnings are ideally returned to customers…but that’s not always the case. Furthermore, inefficiency and waste cut into any dividends customers might expect to receive. When credit unions are not forced to compete as banks are, their management doesn’t work as hard to be thrifty. While a bank strives for a balanced budget like a family would at home, a credit union might be spending three times as much as necessary on plush toilet paper or millions in CEO bonuses that offer its own customers no benefit. You get the picture.
Luana Savings Bank has no problem with competition. That’s the American way and pushes all of us to be our best. What we have an issue with is inequality within a civilized nation. Fight with us to end Credit Union tax breaks. Please contact your local US Representative or Senator and also sign petitions against this inequality.