WASHINGTON—Remittances are coming under fire from Republicans, according to news reports.
The House Republican bill to enact President Trump's domestic policy agenda contains a provision that has prompted opposition from the Mexican government — a tax on cash remittances sent by non-U.S. citizens to family members in their home countries, CBS News reported.
News reports also indicate that many U.S. financial institutions are objecting to the bill.
The payments would be subject to a 5% excise tax that would encompass more than 40 million people, including green card holders and nonimmigrant visa holders, such as people on H-1B, H-2A and H-2B visas. U.S. citizens would be exempt, CBS News explained.
In a May 13 letter to the leaders of the House Ways and Means Committee, Esteban Moctezuma Barragán, Mexico's ambassador to the U.S., urged Chairman Jason Smith and Ranking Member Richard Neal to reconsider the proposal.
"We respectfully urge you to reconsider this section of the legislative proposal, and we remain available to continue dialogue on the matter," wrote Barragán and Robert Velasco Alvarez, Mexico's chief officer for North America, according to CBS News.
The remittance tax provisions outlined in the bill have emerged as an international point of contention. Mexican President Claudia Sheinbaum has expressed her disapproval of the plan and has called upon Republican lawmakers to reassess their position, CBS News said.
At a press briefing , Sheinbaum warned the proposal "would damage the economy of both nations and is also contrary to the spirit of economic freedom that the U.S. government claims to defend."
"Remittances are the fruit of the efforts of those who, through their honest work, strengthen not only the Mexican economy but also the United States', which is why we consider this measure to be arbitrary and unjust," she said, according to the news report.