October 20, 2014 – Vancouver, BC – Firmly entrenched in the Canadian credit union network, Credential Financial is stepping forward to offer its full support of the proposed Capital Growth Tax Credit for credit unions in the federal government’s 2015 Budget.
As co-operative financial institutions, credit unions depend on retained earnings for capital. In 2013, the federal government cancelled a tax credit that had been in place since the 1970s — effectively increasing taxes paid by credit unions by $42 million a year, thereby reducing the amount of retained earnings that can be used to invest in the economic growth of the communities they serve.
By aligning the tax credit with the accumulation of retained earnings, widely regarded as the most robust form of capital, the tax credit would be an important source of strength and growth for credit unions. It would also serve to further several important federal policy objectives such as Canada’s Economic Action Plan.
"While they offer similar services and compete in the same sector as Canada’s Big Banks, credit unions operate with a very different model”, said Credential’s President & CEO, Doce Tomic. “They’re smaller, locally focused, and most importantly, are not capitalized the same. The inclusion of the proposed Capital Growth Tax Credit into the 2015 federal budget would provide credit unions with the necessary capital at their disposal to invest in the charitable giving and community initiatives that credit unions are well regarded for.”
Credit unions are different than banks, and public policy should reflect that difference.
Credential Financial firmly believes that the proposed Capital Growth Tax Credit will empower credit unions to do what they do best: Put billions back into local communities through loans, investments, and community projects. About Credential Financial Inc.
To learn more, visit the My Credit Union Matters! site.
Credential Financial is a national wealth management firm, with over 20 years of experience in the Canadian financial services industry, offering a full suite of products and services to over 225 organizations and more than 1,300 advisors. Credential and its member companies (Credential Asset Management, Credential Securities, Credential Correspondent Partners, Credential Direct, and Credential Insurance Services) provide MFDA and IIROC dealer services, trading and custodian services, online brokerage, and insurance solutions to credit unions and independent financial institutions across Canada. For more information, visit www.credential.com
For more information, please contact:
Lisa Chong, Senior Manager, Strategic Communications
Credential Financial Inc.