Two Pennsylvania Republicans have proposed legislation that would would impose a 10% fee on money sent out of the country electronically by illegal immigrants.
State Sen. Doug Mastriano (R-33) and Sen. Chris Gebhard (R-48) believe the law, if passed, would “deter illegal immigration and generate new revenue for property tax and rent relief,” according to a joint statement issued Feb. 29.
“Illegal immigrants hurt Pennsylvania’s economy by sending money out of the United States and back to their country of origin,” Mastriano said in the release. “This fee would ensure some of that money is used to provide property tax relief rather than going to support the economy of a foreign nation.”
According to the release, the bill would impose a 10% fee “on international remittances conducted by illegal immigrants who send money oversees through a money transfer licensee or agent.”
Revenue generated through the fee would be used to supplement the state Property Tax/Rent Rebate Program, which provides rebates of up to $1,000 to eligible older adults and adults with disabilities.
“While we provide property tax relief, we can also discourage money transfers out of Pennsylvania that could go to support cartels that send dangerous drugs to our communities and perpetuate human trafficking – both disgusting ways to take advantage of other humans,” Gebhard said in the statement.
The senators described the bill as being based on a similar law enacted in Oklahoma in 2014.
Oklahoma’s 1% remittance fee on wire transfers generated more than $12 million for the state in 2023, according to a recent tax report (PDF). The fee is assessed on all international remittances in Oklahoma, but can be recouped by taxpayers as a tax credit.
The World Bank has critiqued the practice and said that it could drive remittances to unregulated channels. The Cato Institute has also argued that, based on the fact that 96% of those who pay the fee in Oklahoma don’t claim the credit, it’s likely that the cost is being paid by many Americans as well as by illegal immigrants.
“We’ve seen this concept has been successful in Oklahoma by preventing millions of dollars from escaping the state economy,” Mastriano said in the release. “This is a commonsense proposal to deter illegal immigrants from draining money out of Pennsylvania’s economy.”
Mastriano and Gebhard are circulating a co-sponsorship memo seeking support from their colleagues before introducing the bill in the state Senate.
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