Oklahoma Still Shows the Way on Collecting Taxes from Illegal Aliens

By David North on January 4, 2020

Every couple of years we check in on Oklahoma's fees on remittances — it is the only state in the Union to tap into this huge outflow of money, most of which is produced by working illegal aliens (as well as some from legal immigrants and some from drug dealers.)

Oklahoma sets a modest (too modest, really) fee of 1 percent on all outgoing wire transfers. The fee is a withholding against the state income tax; to the extent that those remitting money pay their state income taxes the fee is not a tax. But since most of the transfers are outside the state tax system, it works as a de facto tax on untaxed income.

Now, there are comparatively few illegal aliens in Oklahoma, and were such a fee established nationally at, say, 2 percent, it would bring in more than $3 billion a year to the federal government. The Pew Research Center estimated that in 2017 remittances from the United States were more than $148 billion.

Sadly, neither the Obama nor the Trump administrations has moved in this direction.

The most recent report of the Oklahoma State Tax Commission, for the year 2018-2019, shows wire transfer fee receipts of $13,147,000, an increase from the total of $12,874,000 two years earlier. (See p. 11 of the 2018-2019 report.)

Meanwhile the only state in which such a fee is being considered appears to be Georgia, where the formidable activist D.A. King is pushing for it, suggesting that this would be an easy way to raise $100 million or so annually with none of the money being paid by tax-paying voters. The state's Chamber of Commerce is opposed.