Last updated on: 10/29/2013 3:46:13 PM PST
Are a "Fair Share" of Taxes Being Paid by Immigrants Who Are in the United States Illegally?
General Reference (not clearly pro or con)
The United States General Accounting Office (GAO) released a July 1995 report titled "Illegal Aliens National Net Cost Estimates Vary Widely," comparing major findings regarding the economic costs and benefits of undocumented immigrants, that stated:
"Recognizing the difficulties inherent in collecting better data on a population with an incentive to keep its status hidden from government officials, any future studies would benefit from focusing on some of the key characteristics of the illegal alien population...
Illegal aliens generate revenues as well as costs; these revenues offset some of the costs that governments incur. Research studies indicate that many illegal aliens pay taxes, including federal and state income taxes; Social Security tax; and sales, gasoline, and property taxes. However, researchers disagree on the amount of revenues illegal aliens generate and the extent to which these revenues offset government costs for benefits and services."
July 1995 - US Government Accountability Office (GAO)
"Illegal Aliens National Net Cost Estimates Vary Widely" (1.1 MB)
Michael Greenstone, PhD, and Adam Looney, PhD, in their Sep. 2010 Hamilton Project Report, "Ten Economic Facts about Immigration, available at brookings.edu, stated:
"Taxes paid by immigrants and their children—both legal and unauthorized—exceed the costs of the services they use… Many government expenses related to immigrants are associated with their children. From a budgetary perspective, however, the children of immigrants are just like other American children… Both the immigrant children and children of U.S.-born citizens are expensive when they are young because of the costs of investing in children’s education and health. Those expenses, however, are paid back through taxes received over a lifetime of work. The consensus of the economics literature is that the taxes paid by immigrants and their descendants exceed the benefits they receive—that on balance they are a net positive for the federal budget."
Sep. 2010 - Michael Greenstone, PhD
Adam Looney, PhD
Francine J. Lipman, MBA, LLM, Professor of Law at Chapman University School of Law, in the Spring 2006 Harvard Latino Law Review article "Taxing Undocumented Immigrants: Separate, Unequal and Without Representation," wrote:
"[U]ndocumenteds actually contribute more to public coffers in taxes than they cost in social services...
[E]ach year undocumented immigrants add billions of dollars in sales, excise, property, income and payroll taxes, including Social Security, Medicare and unemployment taxes, to federal, state and local coffers. Hundreds of thousands of undocumented immigrants go out of their way to file annual federal and state income tax returns.
Yet undocumented immigrants are barred from almost all government benefits...Generally, the only benefits federally required for undocumented immigrants are emergency medical care, subject to financial and category eligibility, and elementary and secondary public education. Many undocumented immigrants will not even access these few critical government services because of their ever-present fear of government officials and deportation.
Undocumented immigrants living in the United States are subject to the same income tax laws as documented immigrants and U.S. citizens. However, because of their status most unauthorized workers pay a higher effective tax rate than similarly situated documented or U.S. citizens. Yet, these workers and their families use fewer government services than similarly situated documented immigrants or U.S. citizens...As a result, undocumented immigrants provide a fiscal windfall and may be the most fiscally beneficial of all immigrants."
Spring 2006 - Francine J. Lipman, MBA, LLM
Ricardo Parra, former Executive Director of the Midwest Council of La Raza at the University of Notre Dame, in his Aug. 29, 2006 prepared statement to the U.S. House of Representatives Judiciary Committee Hearing on Immigration, "The Reid-Kennedy Bill: The Effect on American Workers' Wages and Employment Opportunities," stated:
"The claims that illegal immigrants are costing taxpayers so much are unfounded, over blown, or somehow skewed based on how the analysis is done or what factors are often left out. Actually, undocumented [immigrants] have been a benefit to our economy...
Fact: Undocumented immigrants pay taxes in a number of ways, including income and sales tax. The majority of undocumented immigrants pay taxes using Individual Taxpayer Numbers (ITINs) or false Social Security numbers... [T]he Social Security Administration reports that it holds $420 billion from the earnings of immigrants who are not in a position to claim benefits...
Fact: Undocumented immigrants are ineligible for the vast majority of state and federal benefits and are only eligible for those that are considered important to public health and safety."
Aug. 29, 2006 - Ricardo Parra
Randy Capps, PhD, Senior Research Associate at the Urban Institute, and Michael Fix, JD, Vice President and Director of Studies at the Migration Policy Institute, in their Oct. 25, 2005 article, "Undocumented Immigrants: Myths and Reality," available on the Urban Institute website, provided the following:
"Undocumented immigrants pay the same real estate taxes—whether they own homes or taxes are passed through to rents—and the same sales and other consumption taxes as everyone else. The majority of state and local costs of schooling and other services are funded by these taxes. Additionally, the U.S. Social Security Administration has estimated that three quarters of undocumented immigrants pay payroll taxes, and that they contribute $6–7 billion in Social Security funds that they will be unable to claim."
Oct. 25, 2005 - Randolph Capps, PhD
Michael Fix, JD
Robert Rector, MA, and Jason Richwine, PhD, in their May 6, 2013 Heritage Foundation report, "The Fiscal Cost of Unlawful Immigrants and Amnesty to the U.S. Taxpayer," available at heritage.org, stated
"Children in unlawful immigrant households receive heavily subsidized public education. Many unlawful immigrants have U.S.-born children; these children are currently eligible for the full range of government welfare and medical benefits. And, of course, when unlawful immigrants live in a community, they use roads, parks, sewers, police, and fire protection; these services must expand to cover the added population or there will be 'congestion' effects that lead to a decline in service quality.
In 2010, the average unlawful immigrant household received around $24,721 in government benefits and services while paying some $10,334 in taxes. This generated an average annual fiscal deficit (benefits received minus taxes paid) of around $14,387 per household. This cost had to be borne by U.S. taxpayers."
May 6, 2013 - Robert Rector, MA
Jason Richwine, PhD
Randy Alcorn, Senior Writing Fellow for Californians for Population Stabilization (CAPS), in the Sep. 2007 CAPS online article "A Presumption That Taxes Probability," wrote:
"While it is empirically true that illegal immigrants are hard working, the presumption that they pay their fair share of taxes is not as visibly verifiable or probable...
Although illegal immigrants pay billions of dollars in Social Security taxes, Social Security taxes are not the main source of revenue for state and federal government—income taxes are...[W]hile illegal immigrant workers have less opportunity to avoid Social Security tax withholdings, they do have opportunity and motivation to avoid income tax withholdings.
So, even if an illegal immigrant worker, who in order to reduce tax withholdings had claimed exemptions for dependents living in Mexico, decided to file tax returns, he or she would likely have a larger tax liability than expected. What are the odds that he or she would come up with the money to pay the additional tax bill after the IRS denied the non-qualifying exemptions? And, if the illegal alien falsely claimed that the dependents did live in the U.S., he or she would still be evading his or her fair share of taxes...
By evading taxes, benefiting from taxpayer provided services, and undermining the wage scale of legal workers, it is highly unlikely that illegal immigrants are a net benefit to most Americans."
Sep. 2007 - Randy Alcorn
Steven A. Camarota, MA, PhD, Director of Research at the Center for Immigration Studies (CIS), in the Aug. 2004 CIS report "The High Cost of Cheap Labor: Illegal Immigration and the Federal Budget," wrote:
"Illegals Create Large Net Costs. ...When defense spending is not considered, illegal households are estimated to impose costs on the federal treasury of $6,949 a year or 58 percent of what other households received. When defense spending is included, their costs are only 46 percent those of other households. However, they pay only 28 percent as much in taxes as non-illegal households. As a result, the estimated net cost per illegal household was $2,736. Whether one sees this fiscal deficit as resulting from low tax payments or heavy use of services is a matter of perspective. As already discussed, illegal households comprise 3.6 percent of the total population, but...they account for an estimated 0.9 percent of taxes paid and 1.4 percent of costs."
Aug. 2004 - Steven A. Camarota, PhD
The Federation for American Immigration Reform (FAIR), in its online article "The Cost of Immigration," updated Feb. 2004, wrote:
"Most illegal aliens have low educational attainment, few skills, and they work for low wages, often in the underground economy where they pay no taxes on their earnings...
The estimated fiscal cost of those illegal aliens to the federal, state and local governments was about $33 billion. This impact was partially offset by an estimated $12.6 billion in taxes paid to the federal, state and local governments, resulting in a net cost to the American taxpayer of about $20 billion every year."
Feb. 2004 - Federation for American Immigration Reform (FAIR)