U.S. President Trump made another move and planned to introduce a large-scale tax reform and spending bill, but it was rejected by the House of Representatives Budget Committee. One provision of the bill that has unexpectedly attracted attention is the requirement to impose a 5% consumption tax on overseas remittances by non-U.S. citizens, which will affect millions of legal immigrants.

The "Big Beauty Act" pushed by Trump has a total of 389 pages. There is a clause hidden on page 327 that requires a 5% consumption tax on overseas remittances by non-citizens, including H-1B work visa, F-1 student visa holders, and green card holders.

Because the provision does not set a minimum amount for remittances, small remittances will also be taxed unless the remitter is a U.S. citizen or national, who is exempt. In addition, any income earned by the above-mentioned persons through investments or stock options in the United States will also be taxed at 5% if transferred overseas.

The proposal would hit Indians working in the United States particularly hard as they are one of the top three immigrant groups in the United States. According to statistics, nearly 2.3 million Indians are currently working in the United States through various visa programs, making them one of India's largest sources of remittances. In 2023 alone, the amount they remit home will reach more than $23 billion.

Akhilesh Ranjan, a former member of India's Central Board of Direct Taxes (CBDT), said: "This tax clearly discriminates against non-U.S. citizens, who contribute to the U.S. economy just as much as U.S. citizens." This tax unfairly targets legal immigrants and will damage the relationship between the United States and the countries where legal immigrants are located.