Mexico’s President Claudia Sheinbaum announced that Mexico will assess the potential effects of a new US executive order that could limit undocumented migrants’ access to US financial services. Concerns were raised at a press conference regarding the impact on remittances, the money sent by Mexicans working in the US to their families in Mexico. Sheinbaum stated that the finance ministry and Mexico’s ambassador to the US are currently evaluating the order, with initial findings suggesting no significant risks.
The recent US executive order aims to increase supervision of cross-border transfers and the identification process for opening bank accounts or accessing other financial services. This move by President Donald Trump could lead to heightened scrutiny on immigrants by involving banks and financial records in US immigration enforcement. Trump’s directive instructs banks and regulators to investigate potential “red flags” related to customers’ immigration and citizenship status as part of a broader crackdown on undocumented immigration.
In a related development, the US Congress is contemplating a proposal to levy a 5% tax on remittances, which currently only applies to cash-based transfers at a rate of 1%. Mexican officials argue against this proposal, citing concerns of double taxation since Mexican migrants already pay taxes in the US. Remittances play a significant role in Mexico’s economy, being one of the largest sources of foreign currency inflows.
