A coalition of financial industry groups, including the American Bankers Association, are opposed to a bill introduced in the U.S. House of Representatives that would impose a tax to fund a border wall.
The Fund and Complete the Border Wall Act (H.R. 85), sponsored by Rep. Andy Biggs (R-AZ), would impose a 5 percent tax on cross-border remittances to fund border walls.
“On behalf of our member companies, many of which engage in the facilitation of remittance transfers, we write to express our concern with H.R. 85, Fund and Complete the Border Wall Act. This legislation, which would subject remittance transfers from the U.S. to foreign countries to a 5 percent user fee, is an ill-advised consumer tax on a legal and heavily regulated financial product used by millions of Americans,” the banking groups wrote in a Feb. 29 letter to members of the U.S. House.
The letter was signed by officials from the ABA, Consumer Bankers Association, Electronic Transactions Association, Bank Policy Institute, Independent Community Bankers of America, Money Services Business Association, Money Services Round Table, and the National Money Transmitters Association.
It could have a negative impact on consumers as well as law enforcement, they said.
“As a matter of principle, taxes on consumer financial products and services are bad policy, no matter what the stated goal. The consumer tax in H.R. 85 would increase the cost of remittance transfers, driving consumers out of regulated financial services and forcing these money flows underground,” the coalition wrote. “When consumers utilize banks and other regulated financial institutions for remittance transfers – firms that have robust anti-money laundering programs – it provides law enforcement and financial regulators visibility into potentially illegal activities. Policies that encourage alternative channels reduce transparency and the ability to properly monitor transactions.”