Trump’s ‘big, beautiful bill’: How it could impact Indians in the US

The Senate side of the Capitol is seen in Washington, early Monday, June 30, 2025, as Republicans plan to begin a final push to advance President Donald Trump's big tax breaks and spending cuts package. (AP)

US President Donald Trump’s sweeping tax-and-spending package, dubbed the “One Big, Beautiful Bill,” is set for a final vote in the House of Representatives. The bill, central to Trump’s second-term agenda, has seen resistance even within his party, due to concerns over rising national debt and cuts to welfare.

After passing narrowly in the Senate, the updated version now includes a major revision impacting millions of Indians in the US.

What’s there for Indians?

The original proposal had included a 5 per cent tax on remittances sent to foreign countries like India. That’s now slashed to just 1 per cent in the final version, offering significant relief to about 4.5 million Indians in the US, including 3.2 million of Indian origin.

The rule will apply to US residents who aren’t citizens, including Green Card holders, H-1B and H-2A visa holders, and international students.

The bill states: “There is hereby imposed on any remittance transfer a tax equal to 1 per cent of the amount of such transfer… The tax imposed by this section… shall be paid by the sender.”

“The tax imposed under subsection (a) shall apply only to any remittance transfer for which the sender provides cash, a money order, a cashier’s check, or any other similar physical instrument (as determined by the Secretary) to the remittance transfer provider,” the draft Bill said.

The tax will apply to transfers made via cash, money orders, or cashier’s checks, but transfers made from financial institutions or funded through US-issued debit/credit cards will be exempt.

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Those using a ‘qualified remittance transfer service’ will also be exempt.

The tax provision had been cut to 3.5 per cent in the House’s earlier draft, but was further reduced to 1 per cent in the final Senate-backed version released June 27. It will be applicable to transfers made after December 31, 2025.

If passed in the House, the bill will represent a defining legislative moment for Trump’s presidency, balancing large tax cuts with deep spending reductions.

Why the tax on remittances matters to Indians

Remittances are a critical source of foreign income for India, supporting millions of households and bolstering the economy.

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As of 2023, around 2.9 million Indians were living in the United States, making them the second-largest immigrant group there, according to the Migration Policy Institute. In 2023–24, India received a record $129 billion in remittances, the highest in the world, with 28 per cent of that coming from the US alone, per World Bank data. Mexico was second with just over $68 Billion.

India also accounted for 14.3 per cent of global remittance flows during the same period, more than any other country in the 21st century.

In states like Kerala, Uttar Pradesh, and Bihar, remittances are not just helpful — they’re essential for everyday survival and financial stability