The Trump administration is planning to introduce a new tax law called ‘The One Big Beautiful Bill’, which would impose a 5% tax on remittances from the US to other countries. This would be a major setback for Indians living in the US, especially those who send money to their families. Trump hopes to use the revenue generated by this new policy for border security projects.
Since Donald Trump took office as the President of the United States for the second time on January 20 this year, difficulties have started for immigrants there. Trump is cracking down on immigrants with strict restrictions. Even those with green cards are no longer protected. Immigration rules have become stricter. The Trump government is not leaving students alone. They are cancelling student visas and deporting them from the United States for minor reasons.
Many are spending sleepless nights due to this. The Trump government is ready to give another shock to foreigners living in the United States. The Trump government is trying to get a new tax law approved called ‘The One Big Beautiful Bill’. Through this law, a tax will be imposed on those who send money from the United States to other countries. The Republican Party is looking to bring a new tax law. If this happens, it will be a big setback for millions of Indians in America.
According to the bill introduced on May 12, non-US citizens will be charged a 5 percent tax on money sent from the US to other countries. This has left millions of Indians living in the US on temporary work visas and student visas worried. Those who send money to their parents and family members in India are worried about this new tax. On one hand, tariffs. On the other hand, Trump is making a fuss with sanctions. Recently, Trump imposed a 100 percent tariff on foreign films.
The US has made some changes to its new tax system. The standard deduction and child tax credit have been increased to $2,500 by 2028. Previously, there was no tax on remittances from people living in the US to their home countries. But the Trump administration is now imposing a tax. This will generate a large amount of revenue for the US government treasury. Trump hopes to use this money for border security projects.
Every year, Indians living abroad send money to India worth around Rs 7 lakh crore. It is estimated that the money coming from America to India will decrease due to the steps taken by Trump. For every Rs 1 lakh sent from America, Rs 5,000 will be deducted in tax. This will reduce the number of people sending money to their home countries. This new tax policy is worrying many people.
Indians are the largest repatriators from the US. According to the Ministry of External Affairs, there are about 4.5 million Indians, of whom 3.2 million are persons of Indian origin.
According to a report released by the Reserve Bank of India in March, about 28% or $32 billion of the $118.7 billion in foreign remittances in 2023-24 came from the US. If Trump’s new bill comes into effect, Indians will have to pay $1.6 billion in taxes.
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