New United States regulations impose a 1% federal excise tax on certain remittances sent from the U.S., effective January 1, 2026, targeting transfers made through Western Union, MoneyGram, cash, money orders, and cashier’s checks. The measure is part of President Donald Trump’s “One Big Beautiful Bill Act,” which was signed into law in July 2025.
Electronic transfers made through U.S. banks, debit or credit cards, and approved digital wallets are exempt from the tax. In Belize, where Central Bank data show remittance inflows reached approximately US$152 million in 2024, families and caregivers could face reduced funds due to the new policy.
The tax is intended to generate U.S. federal revenue from outbound money transfers. It will be collected at the point of transfer, in addition to existing service fees charged by money transfer companies. For a typical US$500 transfer, recipients would effectively receive US$5 less, increasing the financial burden on low-income households that depend on remittances. Service providers must also comply with new U.S. reporting requirements, which could slow transaction times.
Before this measure, no federal tax targeted non-bank remittance services, making cash-based transfers a preferred and accessible option for many Belizeans without U.S. bank accounts. San Pedro’s tourism-driven economy further heightens reliance on these services, as U.S.-based property owners frequently send payments through Western Union and MoneyGram.
Residents in San Pedro have already expressed concern. One female resident who receives monthly assistance from her son in Chicago said, “This tax means less for my grandkids. When it comes to school fees, we will feel every dollar short.” A caretaker for a property in south San Pedro, paid by U.S. owners through MoneyGram, noted that while owners may eventually switch payment methods, “for now, my salary may shrink, which could make it harder as bills continue to rise.”
With many popular digital payment platforms, such as Cash App, Wise, and Venmo, currently unavailable in Belize, the tax could further strain household budgets, reduce remittance inflows, and place additional pressure on the local economy, potentially leading to fewer transfers or higher-cost alternatives.
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