The White House is currently focused on a significant piece of legislation known as the "One Big Beautiful Bill," which is under debate in the Senate. Kevin Hassett, the Director of the National Economic Council, recently spoke with Fox News Digital about the bill, emphasizing that Congress is primarily discussing minor details rather than expecting major changes to its overall language.
One of the key features of the Senate’s version of the bill is the introduction of a 1% tax on international cash transfers, also known as a remittance tax. This tax is expected to affect many immigrants working in the U.S. who regularly send money back home to their families. Each year, billions of dollars are sent as remittances from the U.S. to other countries, making this a significant issue for many families.
The current proposal only applies to cash transfers, not electronic ones, and it will also affect U.S. citizens wishing to send cash abroad. The tax aims to raise an estimated $10 billion in additional revenue for the federal government. Earlier drafts of the bill had proposed higher tax rates, particularly targeting illegal immigrants, but the current version has narrowed its focus.
Experts have mixed opinions about the impact of the remittance tax. Lora Ries from The Heritage Foundation believes that this tax could discourage illegal immigration by making it more difficult for individuals to send money back home. She argues that if the government can limit the ability to send remittances, it could reduce the desire for illegal immigrants to stay in the U.S.
However, some analysts warn that the tax could have unintended consequences. Ariel Ruiz Soto from the Migration Policy Institute points out that reducing remittances to countries like El Salvador, Guatemala, and Honduras, where these funds make up a large portion of the economy, could actually lead to increased migration. If families in those countries struggle economically due to decreased remittances, it might push more people to seek opportunities in the U.S.
The House of Representatives is now considering the Senate’s version of the bill, and discussions are ongoing. This legislation has the potential to reshape how money is transferred internationally and could have lasting effects on immigration patterns and the economies of several countries.