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  1. Financial Institutions
  2. United States: One Big Beautiful Bill Act introduces new excise tax on remittance transfers

United States: One Big Beautiful Bill Act introduces new excise tax on remittance transfers

15 Jul 2025    1 minute read
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In brief

The One Big Beautiful Bill Act, enacted as Public Law 119-21 on July 4, 2025, introduces new section 4475,i which imposes a 1% excise tax on remittance transfers made after December 31, 2025. The provision was initially touted as one that “Makes American Win Again,” because it would affect only certain immigrants. As enacted, however, the excise tax applies equally to all individual taxpayers, whether US citizen, resident, or immigrant. It is unclear just how broadly section 4475 will be applied, but the Joint Tax Committee estimated that it will bring in nearly USD 10 billion of revenue over 10 years.


Contents

Key takeaways

Section 4475 either:

  • Fully excludes remittance transfers sent from certain financial institutions or funded with a US debit or credit card, or
  • Treats the transfer as fully taxable, with secondary liability for the transfer providers.

Click here to access the full alert.


i All references are to the Internal Revenue Code unless otherwise indicated.

 

Contact Information
Anne Batter
Partner
Washington, DC
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anne.batter@bakermckenzie.com
Ligeia Donis
Partner
Washington, DC
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ligeia.donis@bakermckenzie.com
Imke Gerdes
Partner
New York
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imke.gerdes@bakermckenzie.com

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