Lawmakers in Tennessee are advancing a proposal that would place a tax on money transfers sent abroad, targeting what are commonly known as remittances.

The bill, introduced by House Speaker Cameron Sexton and State Sen. Bo Watson, would impose a $10 fee per transaction or a 2% charge on transfers exceeding $500. The measure focuses on personal transfers made through services like Western Union, retail outlets, and currency exchanges, while exempting banks and corporate transactions.

Supporters of the legislation argue it could generate significant revenue—estimated at $183 million annually. According to the proposal, those funds would be distributed across several state priorities, including healthcare programs like TennCare, childcare services, housing initiatives, education efforts, and the state’s general fund.

Remittances—money sent by individuals to family or contacts in other countries—represent a substantial financial flow out of the United States each year. Proponents of the bill contend that taxing these transfers could help retain more money within the domestic economy and offset public costs.

Critics, however, argue that such measures could disproportionately impact immigrant communities and working-class individuals who rely on these transfers to support family members abroad.

The proposal reflects a broader national debate over immigration policy, economic impact, and the role states should play in regulating financial flows tied to migration. If passed, Tennessee would become one of the first states to implement a targeted tax on outbound remittances.