Mexico is Keeping an Eye on a Possible U.S. Tax

The Trump administration has illegals spooked; cash transfers from the U.S. to Mexico jumped 15% in March of this year compared to March 2016. President Trump has threatened to start taxing those transfers.

Texas economist Ray Perryman says it's a drop in the bucket.

"The impact, frankly, is small enough that it won't be measurable; it's a lot of money to you and me, but it actually went up by $300-million and that probably means $60 or $70-million in Texas; Texas is an almost two trillion dollar economy."

But Dr. Perryman says we need to be careful not to chase off too many workers.

"So it's very important for us to get a good plan in place that protects the borders and does the things it needs to do, but also allows us to make use of that workforce because it's a very important part of the Texas economy."

Those cash transfers are said to be Mexico's second largest source of income.

"It emphasizes this fear that's out there right now and the result is a lot of people are afraid to show up for work and things like that so there are some other effects that are going on that this is just another symptom of, but the sheer dollar number is not that big."

But Dr. Perryman says Texas and the U.S. rely heavily on immigrant workers.

"We have 1.2 million undocumented workers in Texas; we only have 600,000 people unemployed, most of those couldn't do those jobs, so we would be probably very close to a million workers short tomorrow if we do anything that's going to restrict that flow of immigration significantly."

The idea of a 5% tax on money sent to Mexico has been floated in Washington.

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