A new bill introduced by US House Republicans proposes a 5% excise tax on all remittances sent abroad by non-citizens, including H-1B and F-1 visa holders. The move, aimed at revenue generation, could heavily impact Indians in the US, who sent over $23 billion to India in 2023. The Indian diaspora and tax experts have raised concerns about its discriminatory nature and economic consequences.

BulletsIn

• US bill proposes 5% tax on outward remittances by non-citizens
• Targets H-1B, F-1 visa holders, green card holders, NRIs
• Could impact monthly family support, investment transfers to India
• For $1,000 sent, $50 would go as tax
• Tax to be collected by remittance service providers
• Providers must deposit tax quarterly with US Treasury
• May push users toward informal, unregulated channels
• Seen as discriminatory by experts and Indian officials
• May pressure US employers to offer higher salaries
• India fears violation of international tax treaties