TransferWise CEO: Plan to fund Trump wall by taxing money sent to Mexico is ‘outrageous’

LONDON – The CEO of online money transfer business TransferWise has attacked plans to fund Donald Trump’s border wall with Mexico through a tax on money sent from the US to Latin America.

Taavet Hinrikus told Business Insider the proposal is “outrageous” and said that: “Adopting irrational policies like this will isolate the US from the rest of the world.”

Republicans in US Congress recently proposed a 2% tax on remittances of money to Latin American countries including Mexico, Brazil, Honduras, and El Salvador.

The bill is known as the “Border Wall Funding Act of 2017” and the money raised from the tax would, if passed, help pay for Trump’s planned border wall with Mexico. The President has repeatedly said that he will make Mexico pay for the project, which could cost as much as $25 billion (£20 billion), according to some estimates.

Huge amounts of cash moves globally through remittances as foreign workers send money back to friends and family in their home countries. The World Bank estimates that over $550 billion (£440.8 billion) was remitted globally in 2016 and the Washington Times estimates that the proposed 2% tax could raise up to $2 billion (£1.6 billion) a year for the US. This money is often an essential lifeline for people living in developing countries.

Taavet Hinrikus, CEO and founder of TranferWise, told Business Insider over email: “Putting a 2% tax on remittances is outrageous. This is not about people paying for their second homes, this is about people supporting their families.

“There was rhetoric around this before the election but we had hoped that common sense and basic human decency would prevail. Continuing to single out nations and strategically targeting certain groups is a dangerous path. Adopting irrational policies like this will isolate the US from the rest of the world.”

London-based TransferWise lets people send money internationally online. It launched transfers between Mexico and the US, a market worth $25 billion (£20 billion) annually, last April.