Winnipeg credit union users could face rate hike
Federal Conservative government axes tax credit for credit unions
Winnipeggers who use credit unions could face higher fees after the federal government scrapped a tax credit for the financial institutions.
The Conservative government announced in its latest budget it would no longer provide a tax break to credit unions.
Gerry Campbell, the vice president of Assiniboine Credit Union, said the change will cost the bank big bucks.
He estimates the move will cost $3 million or about 18 per cent of its annual profit.
Campbell said it could mean curbing expansion plans. The bank recently opened a branch on McGregor Street in Winnipeg’s North End.
Campbell said similar moves could be shelved in the future.
"It would be much more difficult to make that decision with this reduced income that we are facing," said Campbell.
Consumers could also end up paying higher fees and loan rates.
Siobhan Menge does her banking at the credit union’s McGregor location and said she doesn’t want to see the government scrap the credit.
"I don’t think it was democratic and it’s not very fair," said Menge.
Credit unions across Canada are working with government to try to minimize the impact of the tax hike.