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Lawmakers in the United States have introduced a bill seeking to impose a five percent excise tax on remittances sent to foreign countries, a move that could affect millions around the world.<\/p>\n
The proposed legislation was outlined in a draft bill submitted by House Republicans on Monday and it targets funds sent abroad by non-US citizens. Citizens of the US are exempted, once they actually prove or can verify that they are US citizens, and are allowed to claim the tax as a credit.<\/p>\n
\u201cThere is hereby imposed on any remittance transfer a tax equal to 5 percent of the amount of such transfer,\u201d the bill reads. The new tax must be paid by the sender and will be sent quarterly by financial institutions and money transfer services, such as Western Union, to the US Treasury Department, which according to some estimates will rake in billions of dollars. The US House of Representatives is aiming to pass the bill by Memorial Day (May 26, 2025) and if it is approved, it will then move on to the Senate with the intention of it reaching the desk of President Donald Trump by July 4 to be signed into law.<\/p>\n
Trump himself has publicly supported the proposed legislation calling it “great’ and has urged Republicans to ensure its passage.<\/p>\n
Some analysts believe the bill targets undocumented immigrants.<\/p>\n
“If passed as written (a big \u2018if\u2019), we see more headwinds for providers with undocumented customers,\u201d Barclays analyst Ramsey El-Assal wrote in a note to clients.<\/p>\n
He believes it will add to Western Union’s paperwork and operating expenses because it is the company\u2019s job to verify the immigration status of each sender.<\/p>\n
“To attain status as a Qualified Remittance Transfer provider, the remittance provider must enter into a written agreement with the government and agree to verify the citizenship status of each sender,” he stated.<\/p>\n
The proposed bill appears to be having an effect already since stocks of Western Union, one of the biggest money transfer companies, dropped 2.5% on Tuesday after it was made public.<\/p>\n
It is among a series of hard-line policies by the Trump administration, targeting immigration and international trade. In January, US Immigration and Customs Enforcement (ICE) identified nearly 2 million undocumented immigrants for possible deportation. Trump has also signaled plans to end birthright citizenship of children of undocumented migrants and in March, new global tariffs on imports sparked tension with key US trading partners.<\/p>\n
Families in countries around the world, including Dominica, depend heavily on remittances from countries such as the US and others. A report by the World Bank in 2019 showed Dominica received a total of US$49-million in remittances. According to data, the Caribbean on a whole received US$15-billion that year.<\/p>\n
In 2023, people in the US sent a total of $93-billion in remittances to people in countries around the world, according to the World Bank.<\/p>\n","protected":false},"excerpt":{"rendered":"Lawmakers in the United States have introduced a bill seeking to impose a five percent excise tax on remittances sent to foreign countries, a move that could affect millions around the world. The proposed legislation was outlined in a draft…","protected":false},"author":13,"featured_media":341725,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_cbd_carousel_blocks":"[]","footnotes":""},"categories":[235,305,9],"tags":[],"class_list":["post-341724","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-homepage-carousel","category-migration","category-news"],"acf":[],"yoast_head":"\n