State Net Capitol Journal: Immigration Overhaul Could Boost State Coffers

State Net Capitol Journal: Immigration Overhaul Could Boost State Coffers

As the U.S. House of Representatives was debating last week whether to grant citizenship to the nation's estimated 11 million undocumented immigrants as part of an overhaul of U.S. immigration law, a left-leaning think tank released the results of a study indicating that move would boost state and local government revenues by about $2 billion per year. The analysis from the Institute on Taxation and Economic Policy assumes newly legalized immigrants would earn higher wages, increasing the amount of income, sales, excise and property taxes they pay, on top of the $10.6 billion a year they already pay in taxes. According to the study, illegal immigrant families pay an average of about 6.4 percent of their income in state and local taxes, which would go up to 7 percent if they were granted citizenship. 

 
The amount of each state's revenue bump would vary greatly, based on the size of its undocumented immigrant population. For instance, undocumented immigrants paid less than $2 million in taxes in Montana and more than $2.2 billion in California last year. 
 
The non-partisan Congressional Budget Office has also reported that enactment of legislation passed by the Democrat-controlled U.S. Senate last month providing for increased U.S.-Mexico border security in addition to a path to citizenship for illegal immigrants would reduce deficits and curb the flow of illegal immigrants into the United States. But although the bill won support from over a dozen Senate Republicans, its passage in the Republican-led U.S. House is far from certain. Opponents point to a study by the conservative Heritage Foundation estimating legalization would cost the federal government $6.3 trillion over the next fifty years due to the increased use of services and benefits. (REUTERS) 

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