The Trump administration's latest legislative move, dubbed the “One Big, Beautiful Bill,” is set to impose a new tax on remittances, potentially making the U.S. the most expensive country in the G7 for sending money abroad. This decision comes after significant cuts to foreign aid and the introduction of high tariffs, jeopardizing the economic lifelines of countless families in Africa and Latin America who depend on these funds.
Under the proposed plan, a percentage of all remittances sent from the U.S. to other nations would be taken by the government. This is a particularly alarming development for African nations, where poverty rates are acute and many families rely on the funds sent by relatives working in the United States. Reports indicate that countries like Nigeria stand to lose around $215 million due to this new tax. Furthermore, nations such as Gambia and Liberia could suffer disproportionate losses in relation to their national income, with remittances constituting nearly a quarter of their GDP.
Senegal, noted by the World Bank as the most remittance-dependent nation, is also expected to bear a heavy brunt of this financial blow. The looming bill signals a troubling trend in the U.S.'s relationship with Africa, following recent policy changes that have severely diminished international development assistance and preferential trade arrangements.
While the potential loss of billions in remittances will impact a wide array of communities globally, the severity of the effect resonates strongly in Africa, where the economic repercussions could be devastating for the poorest of the poor.
Under the proposed plan, a percentage of all remittances sent from the U.S. to other nations would be taken by the government. This is a particularly alarming development for African nations, where poverty rates are acute and many families rely on the funds sent by relatives working in the United States. Reports indicate that countries like Nigeria stand to lose around $215 million due to this new tax. Furthermore, nations such as Gambia and Liberia could suffer disproportionate losses in relation to their national income, with remittances constituting nearly a quarter of their GDP.
Senegal, noted by the World Bank as the most remittance-dependent nation, is also expected to bear a heavy brunt of this financial blow. The looming bill signals a troubling trend in the U.S.'s relationship with Africa, following recent policy changes that have severely diminished international development assistance and preferential trade arrangements.
While the potential loss of billions in remittances will impact a wide array of communities globally, the severity of the effect resonates strongly in Africa, where the economic repercussions could be devastating for the poorest of the poor.
