Study reveals in figures the contribution of undocumented immigrants

A new study published on Wednesday put the emphasis on data and revealed the multimillion-dollar contribution of tax payment that are making undocumented immigrants in the United States and how the country’s economy would benefit if they could get work permits.

The new study by the Institute of Taxation and Economic Policy (ITEP) aims to help change current criteria, Quantifying how much undocumented immigrants paid in taxesboth nationally and at the state level, in 2022 and demonstrate the benefits that would be received nationwide if all 10.9 million undocumented immigrants received work permits.

Debates over immigration policy raise a wide range of issues that are central to life in the United States, including: how immigration affects their economy.

To shed light on just one of those questions, the study undertook the most comprehensive review to date of federal, state and local tax payments made by undocumented immigrants and analyzed tax contributions, that help finance our infrastructure, institutions and public services, of the 10.9 million undocumented immigrants living and working in the United States.

Keys to the economic contribution of undocumented immigrants

• For every million undocumented immigrants residing in the country, Public services receive $8.9 billion in additional tax revenueOn the other hand, for every million undocumented immigrants who are deported, public services could lose $8.9 billion in tax revenue.

• Provide access to work authorization to all current undocumented immigrants would increase its tax contributions by $40.2 billion a year, up to $136.9 billion.

• More than a third of the tax dollars paid by undocumented immigrants go to payroll taxes intended to fund programs, like Social Security and Medicarewhich these workers cannot access. This would also be resolved by granting them work permits.

• Similarly, the income tax payments of undocumented immigrants are affected by laws that They are required to pay more than American citizens in similar situationsFor example, they are often prevented from receiving significant tax credits, such as the Child Tax Credit or the Earned Income Tax Credit.

• Six states – California, Texas, New York, Florida, Illinois and New Jersey – They raised more than a billion dollars each in tax revenue from undocumented immigrants living within its borders.

• In a large majority of states (40), undocumented immigrants pay state and local tax rates higher than the richest 1% of households living within its borders.

Conclusions

The study concludes that undocumented immigrants contributed $96.7 billion in federal, state and local taxes in 2022, A figure that would increase dramatically if these taxpayers were granted a work permit..

“This study is the most comprehensive analysis of how much undocumented immigrants pay in taxes. And what it shows is that they pay quite a bit, around $100 billion dollars a year,” said Marco Guzmán, senior policy analyst at ITEP and co-author of the study“The bottom line here is that regardless of immigration status, we all contribute by paying our taxes.”

Of the total $96.7 billion in taxes paid by undocumented immigrants, the majority ($59.4 billion) was paid to the federal government, while the remaining $37.3 billion was paid to state and local governments.

Just under half of those state and local contributions come through sales and excise taxes (46% or $15.1 billion), while 31% ($10.4 billion) comes through property taxes and 21% ($7 billion) through personal or business income taxes.

• Annual tax contributions of undocumented immigrants exceed the total combined state budgets from Delaware, South Dakota, Montana, New Hampshire, Vermont, Idaho, Maine, Oklahoma, Alaska, Iowa, Wyoming, Nebraska and Rhode Island.

Undocumented immigrants constitute a larger section of the national workforce than the native population.

• Undocumented immigrants represent 4.7% of the workforce, despite representing only 3.4% of the total US population.

While this study is the most comprehensive analysis of taxes paid by undocumented immigrants, it is worth noting that does not attempt to quantify the broader impacts arising from the increased economic activity created by these individuals.

If these economic ripple effects are taken into account, it would likely be revealed that undocumented immigrants are of even greater importance for public revenues from what is documented here.

This study is another reminder that undocumented immigrants are contributing to our economies and our shared public services, and that ldecisions on immigration policies to be taken in the coming years will have significant consequences for public revenues.

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