COMMENT: Such a controversial tax can give rise to illegal money transfer routes through underworld operations misusing ordinary citizens by luring them with petty commission - as simple as that. This will in the long run undermine what is called American economic freedom and upend the economy itself.

WASHINGTON, May 16: The American ruling party will soon introduce in the US House of Representatives a Bill that imposes a 5% tax on remittances sent abroad by non-citizens in the US.

The new Republican tax is part of the 'One Big Beautiful Bill' proposed by President Donald Trump.

This legislation is expected to have a significant financial impact on migrant workers, particularly Indian professionals who send money back home, although Trump's target is illegal immigrants.

Remittances overseas are mostly sent by green card and visa holders and illegal immigrants, all of whom want to support their families back home. US citizens would be exempt.

In all there are 40 million people in America sending money abroad. A large number of recipients abroad live off such remittances.

Last month Trump had on his social media platform Truth Social floated a post that he is preparing a "presidential memorandum" to “shut down remittances” sent by illegal immigrants. The details have not been released so far.

Several States had tried to check remittances by legislation in the past but not been able to do so. Oklahoma passed a legislation in 2009 to tax $5 fee on remittances on wire transfer under $500 and 1% on amounts above that. But the Federal proposal is different in that it is on remittances made by non-citizens.

Overview of the remittance tax proposal

The Bill mandates that any international money transfer made by a non-citizen will be subject to a 5% tax, which will be withheld at the point of transfer by the remittance service provider.

This tax applies to all non-citizens, including non-immigrant H-1B, H-2A, L-1 and H-2B visa-holders as well as green card holders who have not yet acquired US citizenship.

Impact on Indian workers

India is the largest recipient of remittances globally, with the United States being the top source. In 2023-24, India received $118.7 billion in remittances, with $32 billion coming from the US alone. If the Bill is enacted, Indian-origin residents in the US would collectively bear an estimated $1.6 billion in taxes annually. There are about 45 lakh Indians or people of Indian origin in the US.

Key provisions of the tax

• Flat 5% Tax Rate: The tax applies regardless of the amount transferred, meaning even small transactions will be taxed.
• No Minimum Exemption: Unlike other tax policies that exempt small-value transfers, this Bill does not provide any threshold for exemption.
• Service Providers’ Role: Banks and remittance service providers will be responsible for collecting and remitting the tax to the US Treasury.
• Exemptions: Only verified US citizens and nationals will be exempt from the tax.

Concerns and criticism

The proposal has sparked concerns among immigrant communities, particularly those who regularly send money to family members or invest in property and securities abroad. Critics argue that the tax is regressive, disproportionately affecting low and middle income workers who rely on remittances to support their families.

Additionally, experts warn that the tax could reduce the overall flow of remittances, impacting India’s foreign exchange reserves and economic stability. Some financial analysts suggest that Indian workers in the US may start sending larger remittances before the law takes effect to avoid the tax burden.

Legislative timeline

The Bill is currently under review by the House Ways and Means Committee, with expectations that it could move swiftly through Congress. If passed, it could become law by June or July 2025.

Final remarks

The remittance tax proposal in the One Big Beautiful Bill is one of the most debated aspects of the legislation. While it aims to generate revenue and curb money transfers abroad, it also raises concerns about its impact on immigrant workers, particularly Indians in the US. If enacted, it could reshape financial planning for many non-citizens and alter global remittance patterns.

Some experts say it will only encourage more illegal immigration indirectly but others say a tax would certainly be a control on illegal immigrants.

Such a heavy tax can also give rise to illegal money transfer routes through underworld operations misusing ordinary citizens by luring them with petty commission - as simple as that. This will in the long run undermine what is called American economic freedom and upend the economy itself.

The terminations are part of a large-scale exercise going on all across Fed departments and organisations to reduce wasteful Government expenditure as decided by a Trump in a mess gone berserk, and improve administrative efficiency following the whims of billionaire and his associate Elon MusK and his DOGE. It has not been shared how terminations are going to raise the efficiency bar! It looks like Trump has stolen some of the prescriptions meant for India. But the American problems are quite different.

Suddenly these colonial clerks feel this effortless, little rule will tremendously enhance security and convenience for the railway passengers manifold. More stations will be covered in the next 77 years! (Also See: New Delhi station stampede... What went wrong?)

ANALYSIS: "The standard operating procedure for deportations by aircraft used by ICE that is effective from 2012 provides for the use of restraints," says the Government. That means, it is taken for granted the US will set the standard for deportations. For another, the Government is more interested in comparing with what happened in 2012 under a different Government to justify its own compliance! No surprise, others are trampling upon us. (How we conduct ourselves inside decides, inherently, how we are treated outside) Thirdly, the Government blamed the gangs doing the business of human trafficking for the illegal migration. For all the crimes taking place in the country, let us blame the criminals! Funny! We will never move an inch forward! The mindset defines what we are.

Meanwhile, a UN-returned Congress leader Shashi Tharoor sounded like a layman when he said, "If they are citizens of India we have an obligation to take them back." Who said 'No'?. He should know that is not the issue now. Who will identify an undocumented person, and how?

The function was held indoors from 12 pm (10:30 pm IST) at the rotunda of the US Capitol building because of unusually intense cold and snow. Delivering his inaugural address, Trump remarked, “The golden age of America begins right now," and just hours later signed a slew of executive orders to redeem the election pledges.

The issue: Trump says he is open to 'economic force' to acquire Canada as its '51st State' if it does not stop the flow of illegal migrants and drugs into the US and secure its border.

Trudeau gets ready for the battle: Trudeau under Trump's onslaught had appeared quiet as a lamb because he was facing serious internal problems and now the situation has changed. He has resigned and has enough space for a single-minded counter-attack as acting PM. And that is what he is doing to Canada's advantage. He will prapare Canada to take the 'bull' by the horns (literally) when he takes office on January 20.

There is more to it: On the same page now, Conservative Opposition leader Pierre Poilievre has also outlined his plan to deal with the US President-elect's threats. Both will stand united against the common enemy, and take on him adequately when he assumes office.

And the latest: The counter-attack begins. In a CNN interview, Trudeau strategically addresses the Americans, tells them a ghostly 25% tariff will create a recession in Canada but will be equally devastating for the US economy. And he has a point.

• A President-elect at the instance of 'sensible' aides has declared, “A smaller Government, with more efficiency and less bureaucracy, will be the perfect gift to America.” A Trump statement said he will chop off the bureaucratic flab, or in his own words, “drain the swamp” in Washington. This contrasts with India where millions and millions of clerks rule the roost with the blessings of petty vote bank politicians, who badly needed them, all these 77 years.
• The South African migrant who will benefit more than Trump himself from the election victory has climbed to the helm - Elon Musk will be the monarch of all he surveys in Washington!
• Musk will lead a 'Department of Government Efficiency' with Vivek Ramaswamy, the eccentric dreamer.
• They will slash bureaucracy and Government spending and restructure Federal agencies. (But no mention of what next and how!)
• The irony lies here: Musk will also be the boss of all Federal agencies, including those currently investigating business frauds in his own companies like Tesla, SpaceX and Starlink, which receive Government funding, inter alia making him the richest man on earth.

"We are the only nation not based on race or religion. Literally we are the only nation based on an idea... That all men are created equal."

The former President asked voters to cast their ballot early. (Last elections large-scale early voting had helped Democrats foil any foul play by Trump's alleged foreign agents.)

MAYHEM IN THE AIR: The Civil Aviation Ministry wants to take strict action to prevent more such incidents disrupting Indian aviation!!! Punishment: Culprits of the hoax bomb threats will be put on no-fly list!!! LUDICROUS! Typically this will continue - Both the crime and the punishment. Because our system pushes the scum to the top.

COMMENT: Dragon, unlike what has been reported in the media, is not a rescue mission. Its schedule of liftoff or return has not been changed to suit the stranded astronauts. On the other hand, the astronauts' return has been put off by several months to suit the Dragon's schedule. What SpaceX has done is only dropping two spacemen to accommodate Suni and Wilmore on the capsule's return. And that too was at the instance of NASA which has authority over the choice of astronauts under the contract which facilitates flow of moneys from the American treasury to the pocket of Elon Musk for running his SpaceX business, making him a billionaire and dance with abandon. Result: NASA is a divided house!

Note: The video of the debate (above), a replica of the live telecast, is the best bet to get a real picture of what really was the latest American presidential debate, first hand. Watch.

Kamala Harris had pleaded for unmuting the mic but Trump had his knees knocking. She was a prosecutor and wanted to have a face-to-face with him, an exchange, some pointed questions, unmask him and his money power, expose him before the American people. But that was not to be and we will not call it a debate. Only the moderator will ask questions!

Harris will be seen Tuesday night on the television on the viewers' right side as they sit in front of the set. Viewers tend to focus towards their right side and that in turn can provide a better impact on their voting behaviour. And from the stage's right podium, or the interviewer's stand, she will be in a commanding position vis-a-vis her rival.

HERE's THE PROOF: Attorney General Merrick Garland has accused Russian State broadcaster RT of paying a Tennessee firm $ 10 m to create and distribute content to US audiences with hidden Russian Government messaging. RT chief editor Margarita Simonyan (see pix) is one of 10 people sanctioned by the US for trying to manipulate the elections.

And now Putin declaring an unsolicited support to Harris: A close connection is seen in Trump, in his interview with his chum Musk, making an inappropriate comment calling Harris as most beautiful and comparing her to his wife with a view to blunting her electoral campaign like the fox in the crow story. And Musk later sharing an AI-generated image of Harris as Communist dictator in uniform. The South African has joined the war as his empire is at stake!! All these look like a coordinated Russian traditional job. The Russians managed to give it to Trump in 2016 by damaging Clinton, but failed in 2020!

• In a fiery speech, an emboldened "girl fallen from the coconut tree" opened her box of agenda and promised the Americans she will take the country to new heights.
• Kamala exhorted all Americans to forge a new unity that will "chart a new way forward," a first in history, laying the foundations of a new America, and that's her vision. She was greeted with a non-stop standing ovation by the delegates as she took the mike at the jam-packed convention arena.
• "I will be a President who unites us around our highest aspirations. A President who leads and listens. Who is realistic. Practical," she promised.

Joe Biden was so pleasing to the ears as he sought to invoke the power of democracy and list his Government's achievements all due to the grace of God. But what broke the mike was Clinton's hard metallic, sounding so genuine and dedicated as, may be, she had a revenge carryover from 2016, the year when the Russians were alleged to have begun a social media misinformation campaign in favour of Trump and a suspected hacking of the machines using applications quite unfamiliar to the rest of the world. Which was thwarted by the Democrats in the nick of time in 2020 although Trump as President tried to block them by cutting postal funds. He went violent and attempted insurrection not fully because of his animal insticts but also because he was made to believe in a result like the 2016's and that belief was shattered. What marked out Day One at the convention was a 'presumptive' candidate's unscheduled appearance on the stage made possible by the virtual roll call of August 1 - Kamala Harris, the Vice President. The day also facilitated a less known but deserving New York Guv Kathy Hochul, the American cheetah breaking into the national scene for future purpose! Not well done this time!

ALL ISMs APART, WHO IS Muhammad Yunus? Aside from a Nobel prize that does not assess but compare, Yunus's social biz idea of melding capitalism and social responsibility in the late 1980s, known as microfinance, did revolutionise rural Bangladesh - unlike the destructive infrastructure funding mania of the political underdogs - pulling millions out of perennial poverty, setting an example for many other poor countries to emulate.

On the lines of Dr Verghese Kurien of India much much earlier, who was hounded by the communists as a CIA agent out of compulsive ignorance and a lack of basic ability to gauge what he had done which they should have indeed. He mobilised the Indian grassroots, introducing the concept of cooperatives, the implications of which the pseudo socialists and their forefathers couldn't ever dream of.

Certified for use as store, if the space was being illegally used as library, who should primarily be held responsible, irrespective of whether such usage was the cause of the tragedy or not. Could anybody guess right? No. The police have arrested any number of people! What for? Now a CBI inquiry! Into what?

The court also 'discovered' (nobody else knows!) that, "Delhi has multiplicity of authorities who are only passing the buck and blaming each other.”

A PROGNOSIS: Much maligned over old age and gaffes (or allowed to be !), Biden (81) leaving the scene has made Trump (78) the old man in the field! Now on a weak wicket, having forced to change his target mid-stream and rearrange his campaign strategy, the 'rogue' behind the Capitol rampage will be asked by a woman opponent, how old are you? Additionally, the sharpshooting prosecutor will be converting the hustings into a trial court for a decisive onslaught where the convicted felon will finally succumb.

OPINION: Quotas, permanent Government jobs, pay scales and tons of allowances and more than matching pensions are the 'gifts' of wretched vote bank politics in developing societies masquerading as a type of nascent democracy. Depressing poverty and painful migrations are the byproducts. The reality is: There can't be permanent jobs because demand for work is a 'variable'. And quota is its offspring. The agenda of creating jobs and quotas is therefore poor economics, with far-reaching social impacts, but of course serves those politicians in the short term.