Senior Trump administration officials are reporting that the White House intends to target remittance payments made by illegal immigrants to Mexico.
The move comes as part of a wider leadership shake up at the Department of Homeland Security in an effort to stem the tide of illegal migrants crossing the southern border with Mexico. Illegal border crossings have surged to historic levels in recent months. Many of these illegal migrants have been taking advantage of America’s weak asylum laws to stay in the country almost indefinitely.
The Daily Caller reports:
The White House plan to go after remittance payments falls in line with a proposal from former Kansas Secretary of State Kris Kobach, who is being considered to replace outgoing DHS Secretary Kirstjen Nielsen.
Kobach told Breitbart News on Tuesday that this will be an effective way for President Donald Trump to compel the Mexican government to take more enforcement action against Central Americans trafficking through their country.
Kobach told Breitbart, “The threat I propose is one that actually helps us if we follow through on it. That is the threat of ending remittances from the majority of people in the United States from Mexico who are here illegally,” adding “they don’t want to risk losing that massive flow of foreign capital. In most years, it’s their second biggest source of foreign capital.”
Mexico is the world’s third largest recipient of remittances from America, with over $33 billion being sent across the border in 2018. Many of these payments come from migrants crossing the border illegally to send money back home to their families. Remittance payments made up 2.7% of Mexico’s GDP in 2018.
A tax on remittances was floated as one way Mexico could pay for construction of Trump’s border wall during the 2016 campaign.
It’s likely that a tax on remittances, or even the threat of a tax on remittances, would serve as ample motivation for Mexico to curb the influx of illegal immigrants across the border into the United States. Mexico has thus far been reluctant to stem the tide of illegal migrants flowing through their country. A remittance tax would be a nasty blow to Mexico’s economy that the country could ill afford.