Immigrants Don’t Pay Taxes

All immigrants pay taxes, whether income, property, sales, or other. As far as income tax payments go, immigrants pay between $90 and $140 billion a year in federal, state, and local taxes. Even undocumented immigrants pay income taxes, as evidenced by the Social Security Administration’s “suspense file” (taxes that cannot be matched to workers’ names and social security numbers). In 2002, this suspense file grew by $56 billion in reported earnings, with $7 billion in Social Security taxes and $1.5 billion in Medicare taxes largely paid by immigrants who will never enjoy these programs.

Immigration 101 - Myth vs Reality

Here are some useful facts to help counteract xenophobia in your neighborhood....

Immigrants Don’t Pay Taxes

All immigrants pay taxes, whether income, property, sales, or other. As far as income tax payments go, immigrants pay between $90 and $140 billion a year in federal, state, and local taxes. Even undocumented immigrants pay income taxes, as evidenced by the Social Security Administration’s “suspense file” (taxes that cannot be matched to workers’ names and social security numbers). In 2002, this suspense file grew by $56 billion in reported earnings, with $7 billion in Social Security taxes and $1.5 billion in Medicare taxes largely paid by immigrants who will never enjoy these programs. Immigrants who become U.S. citizens typically pay more in taxes than do native-born citizens because they actually have higher adjusted gross incomes than a typical U.S.-born family. On average, federal taxes paid by families with a naturalized citizen are $1500 more per year than those paid by a U.S. born family.

The U.S. is the Primary Destination for the World’s Refugees and Immigrants

Of the estimated 175 million migrants in the world in 2002, the U.S. accounted for less than 1% or about 1.4 million, both legal and illegal. Undocumented immigrants make up just 30% of all foreign born people in the U.S. and can come from most anywhere. For instance, there are an estimated 50,000 Irish and 500,000 other undocumented European immigrants currently living and working in the U.S. The State Dept. makes a very clear distinction between refugee and immigrant and only accepts about 70,000 refugees per year. In 2002 the largest number of refugees accepted into the U.S. were from the former Soviet Union and numbered about 10,000. A refugee is a person who leaves their country due to a well-founded fear of being persecuted, whereas an immigrant is a person who voluntarily leaves their place of birth in order to migrate.

Most Immigrants Cross the U.S. Border Illegally Through Mexico.

Around 75% of all immigrants have entered the U.S. legally with visas; of those that are undocumented in the U.S. two out of five have simply overstayed their original visas. Of those who enter the U.S. illegally, only about 40% cross the border from Mexico, yet, over 85% of all federal enforcement activity against illegal immigration is concentrated on the U.S.-Mexico border. In contrast, there are 70,000+ Mexican consumers who legally cross the U.S. border to shop in San Diego every day, contributing $40+ billion to the border city’s economy (and $3+ billion in sales taxes) each year.

There Are More Undocumented Immigrants Coming into the U.S. Now Than a Century Ago

Actually, the percentage of the U.S. population that is foreign-born now stands at less than 12%, compared to 15% in the early 20th century. Prior to WWI, most immigrants entered the U.S. without documents, so lack of official papers is nothing new. Close to 68% of all modern immigrants, though, settle in just six states: California, New York, Texas, Florida, New Jersey and Illinois. Just like today, a century ago immigrants were often concentrated in homogenous neighborhoods, spoke their native languages, and established private businesses and social organizations that largely served their fellow (c)migr(c)s. They also experienced the same types of discrimination that today’s immigrants face, and sought to integrate within U.S. society as best they could. Back at the turn of the 20th century it was Irish, Polish, and Italian immigrants (among others) who were called “drunk, lazy, and dissolute.” Now this xenophobic stereotype is applied to others.

Immigrants Are Here to Take Advantage of the U.S. Welfare System

Most immigrants today come to work and to be reunited with family members, just as they did a hundred years ago. The majority of immigrants (70+%) who come to the U.S. are in the prime labor period of their life, and immigrants make up a larger share of the U.S. labor force (12.4%) than they do the overall U.S. population (11.5%). Moreover, the benefits that immigrants receive compared to the taxes they pay represents a net economic drain on immigrant households. In one estimate, immigrants earn about $240 billion a year, pay about $90 billion a year in taxes, and receive only about $5 billion in public benefits.

Immigrants Send Their Money Out of the Country and Are a Drag on U.S. Society

Most of the income earned by immigrants is spent on living expenses in the U.S. For instance, in southern California where a typical immigrant day laborer from Mexico or Central America earns about $8500 per year, just $2600 (31%) of their income was sent to relatives back home. Foreign-born scientists and engineers make up 28 percent of all individuals with PhDs in the United States engaged in research and development. Overall, immigrants create more jobs than they fill thanks to their higher than average rate of business entrepreneurship and the multiplier effect of their economic spending. Whereas Europe and Japan are now suffering from an aging baby boomer population, the United States thanks to immigration has seen continued healthy growth in its labor force. According to a recent study by the Pew Hispanic Center, over 90% of undocumented male immigrants are gainfully employed, 25% have some college education and another 25% have finished high school. While over 80% of immigrants do not speak English at home, within ten years of arrival, more than 75% do speak English. Demand among immigrants for adult English classes far exceeds the existing supply.

Some Selected Sources

Jackson, Jesse. “Let's Deport Immigration Myths.” Chicago Sun-Times. May 9th, 2006.

Massey, Douglas. “Five Myths About Immigration: Common Misconceptions Underlying U.S. Border-Enforcement Policy.” American Immigration Law Foundation. August 2005. Online at: http://www.ailf.org/ipc/policy_reports_2005_fivemyths.shtml

McMahon, Shannon. “Mexican Consumers Pour Billions Annually into San Diego’s Economy.” San Diego Union Tribune. August 7, 2005. National Immigration Forum. “Top 10 Immigration Myths and Facts.” June 2003. Online at: http://www.immigrationforum.org/documents/TheJourney/MythsandFacts.pdf

Passel, Jeffrey. “Unauthorized Migrants: Numbers and Characteristics.” Pew Hispanic Center. June 2005.

PBS. The New Americans – Immigration Myths and Realities Quiz. 2004. Online at: http://www.pbs.org/independentlens/newamericans/quiz/final.htm

Porter, Eduardo. “Illegal Immigrants are Bolstering Social Security with Billions.” New York Times. April 5, 2005.