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US proposes remittance tax, Jamaica to be affected

On RJR’s Beyond the Headlines, host Dionne Jackson Miller discussed this development with Shanike Smart, economist with the think tank, CAPRI, Lawrence Watson, President of the Jamaica Chamber of Commerce, and Wayne Golding, Florida based Jamaican lawyer

 

It could soon cost more for remittances to be sent to Jamaica.
 
A US Congressman has proposed to amend his country's Electronic Fund Transfer Act to impose a fee for remittance transfers to certain foreign countries, and for other purposes.

The Bill, introduced on March 30, 2017 in the US House of Representatives by Alabama Congressman Mike Rogers, seeks to fund US President Donald Trump's proposed wall on  the US-Mexico border through a tax on remittances.
 
The Bill, which is being cited as the Border Wall Funding Act of 2017, proposes to tax remittances to Jamaica and 41 other countries in Latin America and the Caribbean.
 
The plan is for a remittance fee equal to two per cent of the dollar amount to be transferred.
 
The Bill has been referred to the US Congressional subcommittee on crime, terrorism, homeland security, and investigations.
 
Congressman Rogers wants a speedy passage so it can take effect by this September.
 
A recent estimate suggests the wall could take more than US$21 billion to build over a three-and-a-half year period.
 
Jamaicans sent about US$2 billion in remittances from the US last year.
 
If that level is kept up, they would pay close to US$40 million in the remittance tax.

Meanwhile, RJR News contacted GraceKennedy which operates remittance company Western Union in Jamaica and close to a dozen countries in the region.
  
Don Wehby, CEO of GraceKennedy, declined to comment, referring us instead to Western Union.
  
That entity in an email response said is it reviewing the proposed bill.
   
The Bill, as proposed, provides that those who evade a remittance fee shall be subject to a penalty of not more than US$500,000 or twice the value of the funds involved in the remittance transfer, whichever is greater.
  
They could also be imprisoned for not more than 20 years in addition to paying the penalty.
  
In addition, foreign countries that aid or harbour an individual conspiring to avoid the fee shall be ineligible to receive foreign assistance and to participate in the US visa waiver programme or any other programmes.

 



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