Trump to impose tax on diaspora remittances from the US
US President Donald Trump's government has proposed a bill that will see Kenyans living in the US taxed for the money (diaspora remittances) they send back home.
US President Donald Trump’s government has proposed a bill that will see Kenyans living in the US taxed for the money (diaspora remittances) they send back home.
As proposed in ‘The One, Big, Beautiful Bill’ tabled in the US Congress, the US will impose a 5 per cent Excise tax on diaspora remittances from America.
Notably, the bill shoulders the tax burden on Kenyans working abroad.
“This provision imposes a five per cent excise tax on remittance transfers, which will be paid for by the sender with respect to such transfers. The provision requires that the remittance transfer providers collect the tax, and the remittance transfer providers are 43 responsible for remitting such tax quarterly to the Secretary of the Treasury,” read the bill in part.
“The provision also makes it clear that remittance transfer providers have secondary liability for any tax that is not paid at the time that the transfer is made.”
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Should the bill be approved, Kenyans living in the US could reduce the money they send back home because of the additional tax burden.
This will also affect some families back in Kenya who depend on their relatives in the US to support them.
According to the Central Bank of Kenya (CBK), Kenyans receive billions every year from their relatives working abroad, with the US being the leading source for Kenya’s diaspora remittances.
Kenyans living US are estimated to have sent back home Ksh320 billion in 2024.
Therefore, if the new rate is applied, the US will be collecting approximately Ksh17 billion every year from the transfers.
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