It has been a while since we last heard from Trump’s plan to build a wall on the border. This costly venture requires a lot of funding, which is to be paid by the Mexicans. However, a new proposal by the House Republicans imposes a 2% fee on all money immigrants send back home. This fee applies to all transfers, not just those originating from Mexico. An intriguing idea, although it has very little chance of success.
Funding the border wall between the US and Mexico is a tremendous undertaking. President Trump made it abundantly clear he expects the Mexican people to pay for it. While that plan sounded feasible on paper, the reality is very different. In fact, it appears the rest of the world will need to pay for the wall. To be more precise, that this what the new proposal by the House Republicans suggests. Imposing a 2% on remittance transfers is something most people had expected.
Global Remittance Tax To Fund The Trump Wall
What is rather surprising, though, is how this fee applies to all incoming remittance transfers. Regardless of whether the money originates from Mexico or another country, a 2% cut would be in effect. With US remittances expected to hit US$130bn per year, that results in US$2bn of yearly funds for the wall. Then again, this means the wall will be paid for by everyone else and not just the Mexicans. An interesting change of plans, to say the least.
That said, the House Republicans feel this is a “simple” bill. Anyone sending funds to countries benefit from porous borders should be responsible for funding the wall. Keeping money in the American economy remains the number one priority. This also highlights forcing Mexico to pay for the wall was never a possibility to begin with. It is doubtful this new plan will work any better, though. Rest assured a lot of people will find other ways to send money home without paying a 2% fee.
Although this proposal still needs to be approved, it poses new opportunities for bitcoin. After all, cryptocurrency transfers bypass this 2% fee as they do not flow through the banking or remittance system. In fact, it is possible to sue bitcoin and circumvent any issues like these all over the world. It is doubtful the Trump administration will crack down on bitcoin transfers any time soon. Then again, one never knows what the US government will come up with next.
Even if this current plan fails, construction of the wall will go ahead. Trump even stated how the American taxpayers will pick up the tab for now. It is only normal a lot of people are not too happy about this statement, though. Ensuring Mexico pays for the bill in the end will be quite challenging, if not almost impossible. If Trump wants his wall, he could theoretically fund it himself. Everyone needs to contribute to make America great again, starting with the President.
Header image courtesy of Shutterstock
