U.S. President Donald Trump seems intent on filling America’s coffers at the expense of other countries and the world’s most vulnerable people.
In addition to foreign-aid cuts and steep tariff increases, the administration’s One Big Beautiful Bill Act has introduced a new 1% tax on remittances from the United States that are funded by physical instruments such as cash, checks and money orders. This “tax on the poor,” as Mexican President Claudia Sheinbaum refers to it, will impose severe economic and social costs on developing countries.
The amount of money sent by migrant workers to family and friends in low- and middle-income countries (LMICs) has increased more than 17-fold over the last three decades, reaching $685 billion in 2024 — more than official development assistance and foreign direct investment combined. Remittances now comprise at least 3% of gross domestic product in more than 77 countries and far exceed the World Bank Group’s annual lending to developing countries ($128 billion) and the International Monetary Fund’s total outstanding loans (around $145 billion).
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