Ever since the new immigration law came into circulation, the focus has been on the demand upon illegal immigrants to pay ‘back taxes’ in what can be called an immigration tax. Some gain the impression that the immigration bill is now all about tax collection.
The prime selling point of the “Gang of Eight’s” pathway to citizenship for estimated 11 million illegal immigrants is the clause to pay “back taxes” in addition to other fees and penalties. So the people who came illegally have to pay a penalty but not forever exclaimed John McCain.
McCain, the bipartisan Senate group’s chief negotiator noted that back taxes and a fine should make sure that they get in line behind everybody else.
However, confusion prevails to the extent to which the sweeping immigration-reform would pursue past taxes owed by immigrants. Many undocumented immigrants pay their income taxes may be by using Social Security numbers or filing tax returns through taxpayer identification numbers.
So immigration experts speculate that there is not as much money waiting to be tapped as one might expect. Determining back taxes by the large share of immigrants who have worked for cash and off the books could be a challenge.
Critics of “amnesty” for undocumented immigrants say politicians talk about extracting back taxes because it appeals to American pride that everyone should pay their share and there should be consequences for staying illegally.
Steven Camarota, Director of research for the Center for Immigration Studies calls it rhetoric to make the amnesty slip down immigration enforcement and overall reductions in immigration.
In 2007, President George W. Bush persuaded late Edward Kennedy to yank a back-taxes requirement for an immigration bill as it was too much of a bureaucratic headache to implement. Even the Immigration Reform Act of 1986 did not include a back-taxes requirement.