NRI PULSE STAFF REPORT
Atlanta, GA, May 19, 2025: A sweeping legislative proposal backed by President Donald Trump and spearheaded by House Republicans could impose a 5% tax on international remittances sent by non-U.S. citizens, potentially costing Indian Americans an estimated $1.6 billion annually.
Dubbed the “One Big Beautiful Bill,” the legislation cleared the House Budget Committee last week with a narrow 17-16 vote and is headed for a full House debate. The bill includes sweeping tax reforms, stricter immigration enforcement, and defense spending provisions. Among its most controversial components is a remittance excise tax on foreign nationals — including those on H-1B and F-1 visas, green card holders, and undocumented immigrants. U.S. citizens would be exempt.
If enacted, the bill would directly impact millions of Indian in the US, especially those who send money regularly to support families in India. In fiscal year 2023–24, India received approximately $32 billion in remittances from the United States, making it one of the top recipient countries globally. The 5% tax on this amount could translate into a staggering $1.6 billion burden on Indian origin visa holders and green card holders alone.
The proposed tax would be collected at the point of transfer by remittance service providers and funneled to the U.S. Treasury. While the stated intent is to discourage undocumented immigration and raise revenue, critics argue that the policy disproportionately affects legal immigrants who contribute significantly to the U.S. economy.
According to analysts, the bill could dampen financial flows to India, with ripple effects on spending, education, and investment in the Indian economy.
The bill aligns closely with Trump’s broader agenda to “put America first” in trade, immigration, and foreign policy.
House leaders plan to bring the bill to the floor in the coming weeks. If it passes both chambers and is signed into law, it could take effect as early as July 2025.
1 comment
Good Idea. India is torturing NRI(OCI) investors for more tax, strict guidelines to move money out of India. Why can not USA does same? India thinks India can charge more Tariffs on other country goods, but India has to export for free. Bringing money to India is ok for India, but NRIs(OCI) has to suffer with Indian rules. we can not take money out of India. What a hypocrisy in India.