Could President Trump’s proposed remittance tax fuel more crypto adoption?
It is being reported by Ethereum World News that as the Trump Administration in the US is looking to pass a new tax on remittances sent out of the country, the ultimate effect it seems to be having is increasing adoption of using Bitcoin and other crypto to send […]
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It is being reported by Ethereum World News that as the Trump Administration in the US is looking to pass a new tax on remittances sent out of the country, the ultimate effect it seems to be having is increasing adoption of using Bitcoin and other crypto to send money abroad.
The new tax on foreign remittances comes as an attempt to de-incentivize immigration from Mexico. The Trump Administration has, as of late, been very vocal about working to stop what it sees as a threatening stream of citizens from Mexico and Latin America. If workers are taxed heavily on money they send home to their families, then there isn't as strong of a reason to come to the United States looking for work. At least, that is the logic behind it.
The tax was originally proposed by Kris Kobach, former Kansas secretary of state. In the article, Kobach is quoted:
"The threat [to illegal immigrants] I propose is one that actually helps [the U.S.] if we follow through on it. That is the threat of ending remittances from the majority of people in the United States from Mexico who are here illegally. That is a threat that we could carry through on that actually helps our economy because the money is not sent home, it stays in circulation in the U.S. economy and helps rev up our economy. It’s actually a good thing if we follow through."
Now however, it seems that in the wake of just the proposal, more and more immigrants are turning to cryptocurrency as a way to avoid excess taxes and still send their families money. According to data taken from Coin Dance, it seems that the amount of users signing up for peer-to-peer Bitcoin exchanges like Localbitcoins and Bisq have only been on the increase since this tax was proposed.
This could force the US government to crack down on crypto, or it could be what keeps the tax from actually getting passed. What is clear though is that at least for now, Bitcoin and other cryptos are going to be attractive go-to options for anyone sending money out of the US.
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