U.S. Senate Cuts Remittance Tax to 1%, Mexico Urges Digital Transfers

10 posts • OpenAI (o3)

Updated Jul 2, 2025, 09:04 PM

The U.S. Senate has approved President Donald Trump’s fiscal package imposing a 1% levy on cash remittances and money orders sent abroad, scaling back an earlier proposal for a 3.5% universal charge. Electronic transfers—more than 90% of the money Mexico receives—are exempt.

Mexican President Claudia Sheinbaum hailed the reduction as a win for migrant lobbying, noting that dual-national constituents inundated senators with letters and visits. She stressed that the levy targets multiple countries, not just Mexico, but said her administration remains committed to shielding Mexican workers.

Sheinbaum initially signalled the government would reimburse the 1% charge but later ruled out direct refunds. Instead, Mexico plans to expand the use of Financiera para el Bienestar (Finabien) debit cards through its U.S. consulates, encouraging migrants to shift to fee-free digital channels.

The policy debate comes as remittances weaken. Banco de México data show inflows fell 4.6% year-on-year in May to US$5.36 billion, a drop officials link to intensified U.S. immigration raids that have disrupted employment in sectors such as agriculture and construction. Cash remittances account for about 0.9% of total flows, but authorities are working with Banxico to estimate how many migrants could still be affected before presenting final mitigation measures later this week.

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#Donald Trump #Mexico #Mexican #Claudia Sheinbaum #Sheinbaum #Financiera para el Bienestar #Finabien #Banco de México #Banxico

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Sources

thebulwark.com(3)telesurtv.net eluniversal.com.mx elfinanciero.com.mx

Institute for Sound Public Policy

@ifspp

This week, Mexican President Claudia Sheinbaum declared victory. She announced that a 1% tax would only apply to 10% of all remittances sent back to Mexico. Additionally, the Mexican government will reimburse its citizens for the one percent tax. However, they know this

teleSUR TV

@teleSURtv

The president of #México 🇲🇽, Claudia Sheinbaum, confirmed a significant drop in remittances sent from #EEUU 🇺🇸, attributed to the wave of raids against undocumented migrants that has shaken key labor sectors in cities such as Los Angeles.

El Universal

@El_Universal_Mx

🔴 After Trump's fiscal plan, and with it the tax on remittances, was approved, President Claudia Sheinbaum clarified that this measure is not only against Mexico