While Democrats and foreign leaders scramble to protect the billions flowing out of America, GOP lawmakers are fighting to make illegal aliens pay their fair share with a 15% tax on money transfers sent abroad instead of 3.5%.
The proposal, part of President Trump’s “One Big Beautiful Bill Act,” aims to generate $26 billion from non-citizens sending remittances to their home countries over the next decade.
The remittance tax targets a massive flow of untaxed money leaving the United States.
In 2024 alone, transfers from the US to Latin America and the Caribbean reached a staggering $160.9 billion, with Mexico receiving the lion’s share.
This money, often earned in America’s underground economy, flows tax-free across the borders while American citizens struggle under their own tax burdens.
Mexican President Claudia Sheinbaum has inserted herself into American politics by opposing the measure, even threatening to “mobilize” against it.
“If necessary, we’ll mobilize. We don’t want taxes on remittances from our fellow countrymen. From the US to Mexico,” Sheinbaum declared.
This statement clearly intends to interfere with America’s sovereign right to manage its tax policy.
Some Republican lawmakers believe the proposed 3.5% tax does not go far enough.
Senator Eric Schmitt (R-MO) is pushing to increase it significantly, stating:
“The House’s Big Beautiful Bill addressed the urgent need for a remittance tax. But we can go further. I’m introducing legislation to quadruple the proposed remittance tax — from 3.5% to 15%.”
The tax would only apply to non-citizens, exempting American citizens entirely.
This targeted approach ensures that only those who have not fully committed to American citizenship would contribute to the nation’s coffers through this mechanism.
The Joint Committee on Taxation estimates the tax could generate over $1 billion in revenue by 2026, rising to $3 billion by 2034.
During the construction ceremony for the Los Cabos Regional General Hospital in Baja California Sur, Sheinbaum stressed that the US “can’t tax people twice when they’re already paying taxes.”
Her argument falls flat when considering that many illegal aliens work in the underground economy and do not pay income taxes in the first place.
Furthermore, even those who do pay some taxes through payroll deductions often use fraudulent Social Security numbers and still receive numerous government benefits without contributing their fair share to the system.
Critics claim the tax would hurt developing countries where remittances make up significant portions of their GDP.
According to economic expert Jesus Alejandro Cervantes Gonzalez, remittances account for “20% of GDP in Guatemala, 27% in Nicaragua, 26% in Honduras, 24% in El Salvador, 20% in Haiti, and 19% in Jamaica.”
Texas Representative Chip Roy (R) suggested an even stronger response after hearing Sheinbaum’s threats, tweeting this was a “New reason to amend the Senate bill to tax remittances at a lot higher rate…”
The remittance tax represents a common-sense approach to both raising revenue and discouraging illegal immigration.
By implementing this measure, America can recapture billions of dollars currently flowing out of the economy without being taxed.
