Taxes and Spending Power
The contributions immigrants make as both taxpayers and consumers are indispensable to the U.S. economy. Nationally, immigrants earned $1.3 trillion in 2014 and contributed $105 billion in state and local taxes and almost $224 billion in federal taxes. This left them with nearly $927 billion in spending power, which they frequently used to purchase goods and services, stimulate local business activity, and create jobs in the broader U.S. economy.
Immigrants Mean Strong Economy and Tax Base, Says Leader of Alabama Nonprofit
Isabel Rubio, a second-generation Mexican American and executive director of the Hispanic Interest Coalition of Alabama (HICA), believes that when we give all Americans – immigrants or otherwise – equal opportunities, the entire country benefits. “Forget what side of the immigration line you’re on, this is an economic issue,” says… Read More
With the Proper Tools, Immigrants can Boost Housing Values, says Financial Educator
Irene Caudillo’s father, a Mexican immigrant, didn’t get a bank account until he was 62 years old. He was typical of many immigrants, then and now — wary of banks and unaware that mortgages and business loans are available to them. The unbanked, as they’re called, end up more likely… Read More
President of U.S.-India Chamber of Commerce Dallas/Fort Worth Explains Slow Immigration Process’s Negative Economic Impact
When Neel Gonuguntla was appointed president of the U.S. India Chamber of Commerce Dallas/Fort Worth in 2014, her mission was to unite the Indian business community with the area’s non-Indian business community. “We want to make sure that the broader community is aware of the on-goings in the Indian business… Read More
Indian Entrepreneur Creates a Better Hospital Call Button
Hospitalized and experiencing pain, Srinath Vaddepally did what millions of patients do: He reached for the hospital call button to summon a nurse. Then he did something one in seven patients in hospitals do: he fell. The 20 agonizing minutes he spent on the floor were enough to realize there… Read More
Student: U.S. Can Harness Billions of Dollars From Immigrants
Adrian Arreola is the child of immigrants and has witnessed firsthand the fight for success in the United States. “What my dad accomplished with his drive and determination, especially coming from nothing, is amazing,” says Arreola. “I tell him he’s my idol every day.” Indeed, his father was an undocumented… Read More
Indiana’s Primary: Immigrants in the Hoosier State
The 2016 primaries are rapidly nearing a close, and today the votes are being held in Indiana. There are 57 Republican delegates and 83 Democratic delegates to be awarded, and they can be critical wins for any candidate to secure nomination. Indiana’s immigrant population growth was relatively slow… Read More
Today’s NY Primary: How Immigrants are Contributing in the Empire State
After rigorous campaigning in the Empire State, the presidential hopefuls watch as New Yorkers head to the polls today to vote in the state’s primary election. Clinton, Sanders, and Trump certainly hope to reign victorious on their home turf, especially since New York has the potential to award a large… Read More
Tax Day: Tax Contributions of Immigrants in the United States
Today is Tax Day—the widely dreaded annual deadline for filing federal income taxes. This year, it falls on the same day that the Supreme Court is scheduled to hear oral arguments in the U.S. v Texas immigration case about President Obama’s executive actions to expand Deferred Action for… Read More
Immigrant from South India Helps Walmart Thrive
Zakir Syed would never have imagined that by age 37, he would be working at a high-level job at Walmart, one of the largest employers in Arkansas. Growing up in Karnataka, a state in southwestern India, he lived with his family in a small home without running water or a… Read More
A ‘Most Influential’ Atlantan Says She is a Testament to What Immigrants Can Achieve When They Feel Wanted
Shortly after Lucia Jennings arrived in Valdosta, Georgia, from Rio de Janeiro to attend nursing school in 1975, someone from the local chamber of commerce knocked on her apartment door with a care package of maps, directories and a guide to the area’s best doctors. “I will never forget that,”… Read More
Household Income of Immigrants
In 2014, more than 72 percent of foreign-born population in the United States was working-aged, compared to less than half of U.S.-born residents. This reality allowed immigrants to earn well over a trillion dollars of income in 2014—a greater amount than their portion of the U.S. population overall.
Tax Contributions
A notable portion of the income earned by immigrants each year funnels directly back to our government in the form of tax revenues. In some states, immigrants contribute more than one out of every four tax dollars paid by local residents each year—supporting taxpayer-funded services like public schools and police departments.
States Where Immigrants Contributed the Largest Share of Total Tax Revenues, 2014
Spending Power
Spending power is the disposable income left to households after deducting their annual tax contributions. The $9.3 billion in total spending power held by immigrant led households in 2014 allowed them to hold considerable power as consumers. By spending on goods and services, immigrants strengthen the U.S. economy and provide jobs to American workers as well as the businesses dependent upon paying customers.
Foreign-Born Population’s Amount and Share of Spending Power by State, 2014
Medicare and Social Security
Our Social Security and Medicare programs are already facing serious financial challenges—a pattern expected to worsen as large numbers of Baby Boomers retire and leave the workforce altogether. While the United States had roughly 16 workers paying into our entitlement programs for every one retiree in 1950, that number is projected to drop to just two workers for every retiree by 2035.1 Immigrants are already playing an important role supplementing our entitlement programs: One NAE study found that between 1996 and 2011 immigrants contributed $182.4 billion more to Medicare’s Hospital Insurance Trust Fund—the core trust fund in the program—than was expended on their care.
Sources:
1 “10 Truths About America’s Entitlement Programs, Address by R. Bruce Josten Executive Vice President of Government Affairs U.S. Chamber of Commerce,” U.S. Chamber of Commerce, accessed September 21, 2016. Available online.
Bolstering the Housing Market
By purchasing homes in neighborhoods formerly in decline, immigrants in recent decades have had a positive impact on U.S. housing values overall. From 2000 to 2010, each of the 40 million immigrants in the United States added, on average, 11.6 cents to the value of a home in their local county. That seems small, but it adds up. In fact, it resulted in immigrants growing U.S. housing wealth by $3.7 trillion during that period.2 Immigrants are also expected to play a key role buying up homes as baby boomers downsize in the coming years: Almost 30 percent of American homeowners were older than age 65 in 2014.
Sources:
2 Jacob Vigdor, “Immigration and the Revival of American Cities,” New American Economy, 2013 Available online.
Immigrant Subgroups
Regardless of where the immigrants came from, they contribute a tremendous amount of money to the U.S. economy as taxpayers and consumers. In this section, we show the amount earned and contributed in taxes by different ethnic and national origin groups within the foreign-born population.
Taxes & Spending Power of Major Immigrant Subgroups
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