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3mo ago

Senate Debates Hike to Remittance Tax After Mexico’s Mobilization Warning

Backers say a 3.5 percent levy could generate $26 billion over the next decade to help cut off cartel funding.

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Sen. Eric Schmitt (R-MO) gestures while speaking during a news conference on Capitol Hill on May 22, 2024 in Washington, DC. Senate Democrats have revived the bipartisan border bill that was already blocked once earlier this year, and Republicans including Sen. James Lankford (R-OK), who negotiated the immigration package say they will block it again. (Kent Nishimura/Getty)
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Overview

  • The Senate is reviewing a 3.5 percent tax on remittances sent by noncitizens as part of the One Big Beautiful Bill Act.
  • Sen. Eric Schmitt and other Republicans have filed amendments to raise the remittance fee to 15 percent following Mexico’s public objections.
  • President Claudia Sheinbaum condemned the proposal and urged the Mexican community in the US to organize peaceful demonstrations.
  • The Joint Committee on Taxation projects the levy could raise about $26 billion over ten years, with advocates arguing it will deter cartel financing.
  • The debate has intensified tensions in US-Mexico relations and reignited disputes over immigration policy and border security.