Proposed Revision to US Remittance Tax in BBB

[NoDisplayName]

A new draft of the "One Big Beautiful Bill", released on June 27, shows big changes from the earlier version passed by the House of Representatives. The tax was originally proposed at 5 per cent in the House bill under the Trump administration before being reduced to 3.5 per cent and now further lowered to 1 per cent in the Senate draft.

   

But crucially, this tax will only apply to cash or similar physical payments handed over to money transfer providers. Transfers done through bank accounts or debit and credit cards issued in the US won’t be taxed. The bill says the tax is “limited to cash and similar instruments… only to any remittance transfer for which the sender provides cash, a money order, a cashier’s check, or any other similar physical instrument.”

 

https://www.business-standard.com/world-news/us-senate-lowers-proposed-remittance-tax-to-1-spares-bank-transfers-125062800890_1.html

 

 

 

Appears under this revision the tax would only apply to poor migrant workers who use Western Union to send their salaries back to Mexico to feed their kids.

[Jingthing]

I don't approve of soaking those workers or that big ugly bill in general but if this report is true, that is very good news for the typical American expat in Thailand who does remittances.

[gargamon]

So Wise transfers too then?

[NoDisplayName]

2 minutes ago, gargamon said:

So Wise transfers too then?

 

Wise uses electronic transfers not physical cash or cashiers checks, and would be considered a financial institution, so appears to fit the definition to be exempt.

[Jingthing]

I'm actually surprised to hear this good news.

I'm wondering how it happened.

I seriously doubt the change was done out of regard for the well being of American expats.

I think more likely the banking lobby which presumably is very powerful made it clear they don't want to have to deal with the additional work to enforce this.