Background on the Issue
Mexican lawmakers have decided to take action against a proposed 5% tax on remittances sent by migrants to their home countries, including Mexico. This tax is being considered as an additional burden on migrants who already pay taxes through their work and the high costs of sending money back home. The Mexican Congressional Permanent Commission unanimously approved sending an official communication to the U.S. Congress, urging them to reconsider this measure that is expected to be voted on no later than May 23.
Key Players and Their Stances
The initiative, promoted by Republican Representative Jason Smith in the U.S. House of Representatives as part of “The One, Big, Beautiful Bill,” aims to impose a 5% tax on the amount of remittances sent by migrants. Mexican senators, using their foreign policy powers granted by Article 76 of the Constitution, have expressed strong disagreement with this proposal.
- Senators’ Stance: They have labeled the measure as “arbitrary and unjust.”
- House of Representatives’ Stance: Mexican lawmakers have categorically rejected the U.S. government’s proposal for a remittance tax.
Impact of Remittances on Mexico
Adán Augusto López, coordinator of the Morena senatorial bloc, highlighted that migrants transfer approximately $650 billion annually to their countries of origin through remittances. Mexico, ranking second globally after India, receives over $65 billion from these transfers.
Miguel Márquez of the PAN explained that this tax would constitute a “triple tributation” since migrants already pay taxes through their work and bear the high costs of sending money, which would increase by an additional 5%.
Manuel Añorve, coordinator of PRI senators, emphasized that despite political differences, there has been a firm agreement to reject the proposed remittance tax.
Next Steps
As part of their response, Mexican lawmakers plan to send a technical and political document to the U.S. Congress, outlining their position. They will also form a diverse group of legislators to attend hearings before the U.S. House Committee or Plenary.
Key Questions and Answers
- What is the proposed tax on remittances? The U.S. Congress is considering imposing a 5% tax on the amount of remittances sent by migrants to their home countries.
- Why are Mexican lawmakers concerned? They argue that this tax would result in a “triple tributation” since migrants already pay taxes through their work and the high costs of sending money, which would increase by an additional 5%.
- How much do migrants send to Mexico through remittances? Approximately $65 billion, which is the second-highest amount received globally after India.
- What is the Mexican Congress’s response? The Mexican Congressional Permanent Commission unanimously approved sending an official communication to the U.S. Congress, urging them to reconsider this measure.
- What actions will Mexican lawmakers take? They plan to send a technical and political document to the U.S. Congress and form a diverse group of legislators to attend hearings before the U.S. House Committee or Plenary.
