In addition to recent cuts in foreign aid and the introduction of steep tariffs on various nations, President Donald Trump has put forward legislation that would impose a tax on remittances sent from the U.S. to other countries.
This proposal, part of Trump’s broader legislative package called the ‘One Big, Beautiful Bill,’ would enable the U.S. government to collect a percentage of all money transfers sent abroad.
Critics argued this move could severely impact recipients, particularly in low-income countries that rely heavily on remittances for daily survival.
According to the New York Times, if enacted, the bill would mark another step in the U.S.’s withdrawal from Africa, following the president’s significant reductions in foreign assistance and the introduction of unprecedented tariffs targeting the continent.
Observers warned that the legislation would require immigrants to pay an additional 3.5% federal tax on remittance transfers, on top of the existing fees, usually about six percent, charged by banks and money transfer services.
This would amount to nearly $10 lost on every $100 sent, making the U.S. the costliest country for sending money home.
Nigerians stand to be the most affected, potentially losing around $215 million annually under the new tax. Other African nations such as Senegal, The Gambia, and Liberia are also expected to face significant impacts.
Helen Dempster, a policy expert at the Centre for Global Development, told the New York Times that African countries would bear the brunt of the bill’s effects.
She warned that the poorest populations would be hit doubly hard by this tax and other restrictive policies from the U.S. government.
Dempster explained that the bill appears aimed at deterring immigration to the U.S. while pressuring those already residing in the country to consider voluntary self-deportation.
Analysts have described the proposed tax as a direct blow to the generosity of diaspora communities.
They cautioned that it risks worsening food insecurity for millions, encouraging undocumented migration, and stalling economic growth in African countries already burdened by debt.
The chairperson of the Nigerians in Diaspora Commission, Abike Dabiri-Erewa, has yet to comment on how this bill might affect Nigerians living in the United States.
Last month, President Trump announced a $1,000 payment to migrants who voluntarily return to their home countries.
Homeland Security Secretary Kristi Noem explained that this measure is part of the administration’s efforts to encourage self-deportation and fulfill the president’s immigration policy goals.
