A new legislative proposal backed by Donald Trump is generating a strong reaction among migrant communities in the United States and Latin America. It is a 5% tax on all remittances sent from the U.S. by people who cannot prove their U.S. citizenship.
The bill is included in the legislative package known as “One Big, Beautiful Bill”, promoted by Republican legislators with a view to consolidate fiscal and immigration reforms before the November 2024 presidential elections. According to the most recent draft, the tax would apply starting in 2026 and would affect immigrants with permanent residency, temporary visas and even beneficiaries of programs such as DACA or TPS. Only U.S. citizens who can verify their status through official documents at the time of transfer would be exempt.
What impact would this tax have?
According to updated data from the Migration Policy Institute (MPI), remittances sent from the U.S. will exceed $70 billion in 2024.
It is a vital source of income for millions of families in Latin America.
In countries such as Guatemala, El Salvador and Honduras, remittances represent between 20% and 28% of GDP.
In Mexico, the percentage is around 4%, but the volume of remittances exceeded US$65 billion in 2024, according to figures from the Bank of Mexico.
For many households, these funds are essential to cover food, health, education and housing.
An additional tax on remittances would directly reduce the money flowing to these families, affecting social and economic welfare throughout the region.
Response from governments and experts
Buzzy
Mexico’s President Claudia Sheinbaum called the proposal “unacceptable” and “unconstitutional”.
He argued that this is a form of double taxation, as migrants already pay federal, state and payroll taxes in the United States.
For its part, the Mexican Congress requested an urgent bilateral dialogue with its counterparts in Washington to prevent this measure from moving forward without considering its regional impact.
In the U.S., organizations such as the National Immigration Law Center (NILC) and UnidosUS have warned that this type of tax on remittances could push many migrants to use informal channels, putting the security and legality of financial transactions at risk.
What’s next for the proposal?
Although the bill has not yet been approved, its inclusion in the Republican agenda and Trump’s endorsement make it a priority issue.
In order to become law, it must be approved by both houses of Congress and then signed by the president.
El impuesto se aplicaría a partir de 2026
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In the meantime, lawyers and experts recommend migrant families to be well documented and seek legal advice before making important financial decisions.
For more information, visit QuéOnnda.com.
