Daijiworld Media Network - Washington
Washington, May 19: In a move that could hit thousands of Indian families hard, the US House Budget Committee late Sunday advanced former President Donald Trump’s controversial “One Big Beautiful Bill Act,” which proposes a 5% tax on all international money transfers by non-US citizens — including H-1B visa holders and green card holders.
The bill, which passed narrowly by a 17-16 vote, targets remittances made by immigrants, without setting any exemption threshold. That means even small amounts sent back home will be taxed unless the sender is a verified US citizen.
This development comes as a blow to nearly 45 lac Indians living in the US, of whom about 32 lakh are persons of Indian origin. According to a March report by the Reserve Bank of India, India received $32 billion in remittances from the US in 2023-24. If the bill becomes law, the Indian community could be forced to pay around $1.6 billion annually in taxes on these transactions.
The proposed tax also applies to investment income and stock option proceeds sent abroad — common financial lifelines used by NRIs to support families and invest in India.
Apart from the remittance clause, the sweeping 1,116-page bill also focuses heavily on immigration enforcement. It seeks to allocate $46.5 billion to revive construction of the US-Mexico border wall, $4 billion to hire thousands of new border and customs officers, and over $2 billion in bonuses to retain agents. There’s also funding for 10,000 more Immigration and Customs Enforcement (ICE) officials.
In an unprecedented move, the bill proposes a $1,000 fee for migrants seeking asylum — a first in American history, aligning the US with strict regimes like Australia and Iran. Trump’s broader goal under the bill is to deport one million immigrants annually and detain up to 100,000 at any given time.
Friday saw internal resistance from a group of Republican hard-liners who blocked the bill’s progress, defying Trump. But Sunday’s vote puts the legislation a step closer to a full floor debate and possible passage.
If enacted, the bill could not only strain the pockets of Indian residents in the US but also severely impact India’s economy, which depends heavily on remittances as a source of foreign exchange.