INTERNATIONAL
Trump's remittance tax hits Mexico's poorest
Women walk near a church in San Bartolome Quialana, where nearly half of the community's residents have migrated to the US, working in agriculture and hospitality, in San Bartolome Quialana, Mexico. -REUTERS/Jorge Luis Plata
THE families of Mexican migrants to the U.S. are bracing for the financial impact of a proposed 3.5-percent tax on remittances sent by non-U.S. citizens, as President Donald Trump's latest budget proposal moves through Congress.
AI Brief
Mexico is the second-largest recipient of U.S. remittances after India. Remittances of U.S. dollars represent around four percent of the country's GDP.
During the Biden administration, migrants from Hidalgo, a state in central Mexico where migration to the U.S. has long been a lifeline, sent over six billion dollars in remittances back home to help sustain families in this impoverished state.
Now, as Trump seeks a piece of that pie, family members of migrants say they would struggle to adjust.
"It's quite a lot, a lot, because it wouldn't be enough for anything anymore, honestly, not anymore. Things are going up quite a bit, so it wouldn't be enough for anything anymore. If it was half enough before, it's not enough now," said Agustina Godinez, a resident in Epazoyucan.
If the remittances tax, part of Trump's "big beautiful" budget bill, is implemented, Mexico stands to lose over 2.6 billion dollars annually.
The hardest-hit regions will be those most dependent on these funds, as the cost of sending the average 350-dollar remittance would jump significantly from around 5 dollars to 17 dollars.
Adding to the strain, banking data showed remittance volumes to Mexico have already dropped more than 12 percent this year, as migrant workers face harsher conditions in the U.S. under Trump's policies.
"We do have this feeling that if there were raids in a certain place, we say, I'd better go tomorrow or the day after, or whatever. But yes, it's affected us," said Pablo Salazar, a returning migrant.
Mexico's President Claudia Sheinbaum has condemned the proposed remittance tax, calling it unconstitutional.
As Trump tightens restrictions on migrant workers, his economic policies could end up hurting not just those in the U.S., but their families across the border who rely on every dollar sent home.
Your gateway to global news, insights, and stories that matter.
AI Brief
- A proposed US remittance tax may cost Mexico over $2.6 billion annually, hitting poor regions hardest.
- Migrants in the US face harsher conditions and rising fees to send money home, leading to a drop in remittances.
- Families in Mexico say they can't survive without the full amount, while President Sheinbaum condemns the tax as unconstitutional.
Mexico is the second-largest recipient of U.S. remittances after India. Remittances of U.S. dollars represent around four percent of the country's GDP.
During the Biden administration, migrants from Hidalgo, a state in central Mexico where migration to the U.S. has long been a lifeline, sent over six billion dollars in remittances back home to help sustain families in this impoverished state.
Now, as Trump seeks a piece of that pie, family members of migrants say they would struggle to adjust.
"It's quite a lot, a lot, because it wouldn't be enough for anything anymore, honestly, not anymore. Things are going up quite a bit, so it wouldn't be enough for anything anymore. If it was half enough before, it's not enough now," said Agustina Godinez, a resident in Epazoyucan.
If the remittances tax, part of Trump's "big beautiful" budget bill, is implemented, Mexico stands to lose over 2.6 billion dollars annually.
The hardest-hit regions will be those most dependent on these funds, as the cost of sending the average 350-dollar remittance would jump significantly from around 5 dollars to 17 dollars.
Adding to the strain, banking data showed remittance volumes to Mexico have already dropped more than 12 percent this year, as migrant workers face harsher conditions in the U.S. under Trump's policies.
"We do have this feeling that if there were raids in a certain place, we say, I'd better go tomorrow or the day after, or whatever. But yes, it's affected us," said Pablo Salazar, a returning migrant.
Mexico's President Claudia Sheinbaum has condemned the proposed remittance tax, calling it unconstitutional.
As Trump tightens restrictions on migrant workers, his economic policies could end up hurting not just those in the U.S., but their families across the border who rely on every dollar sent home.