A nonprofit group has released data showing how much taxes immigrants in the U.S. pay, as rhetoric on immigration intensifies just months before Election Day. The Institute on Taxation and Economic Policies is a nonprofit, nonpartisan tax policy organization. The institute’s report, Tax Payments by Undocumented Immigrants, shows that in 2022, those who work (…)

A nonprofit organization has released data showing how much taxes immigrants pay in the U.S., as rhetoric on immigration becomes increasingly clear just months before Election Day.

The Institute on Taxation and Economic Policies is a nonprofit, nonpartisan tax policy organization. The Institute’s report, “Tax Payments by Undocumented Immigrants,” shows that those working without papers paid $96.7 billion in federal, state, and local taxes in 2022.

Jacob Vigil, deputy political director of New Mexico Voices for Children, said NM Political Report that migrant workers not only pay taxes but are also excluded from most public services due to rhetoric built on exclusion and “actual misconceptions that immigrants have about the public sector and public finances”.

“Added to this are the economic impacts of their presence on the labour market,” he said.

In New Mexico, illegal migrant workers paid $153.8 million in state and local taxes in 2022. In a press release, NMVC stated that this amount would increase to $174.1 million if illegal migrant workers were granted work permits. This estimate takes into account the likelihood that immigrants’ wages would improve if they were granted work permits.

Vigil noted that there have been efforts in New Mexico during the COVID-19 pandemic to implement pilot programs to expand some benefits, such as the state’s child tax credit. A bill passed by the state in 2021 expanded the Working Families Tax Credit.

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While this has helped undocumented workers, they remain excluded from federal tax relief programs and other federal and state benefits, including Social Security and Medicare.

According to the Immigrant Legal Resource Center, undocumented workers can apply for an individual tax identification number. When a person earns income in the United States, they must pay taxes on it, regardless of their status.

Immigrants are encouraged to apply for an ITIN. Although having an ITIN and paying taxes does not equate to work authorization or legal status, an immigrant who does not apply for an ITIN and pay taxes would receive a negative factor in future immigration proceedings, according to the ILRC.

Vigil said some data is notable. Nationwide, undocumented workers contributed an average of $8,900 per person to public services in 2022.

According to Vigil, migrant workers make up a significant portion of New Mexico’s workforce and, in addition to income taxes, pay the gross receipts tax on most goods and services, as well as excise taxes levied on things like cigarettes, alcohol, betting, sodas and entertainment activities. They also pay property taxes, either through owning a home or through renting it, when the property tax is passed on to the renter.

According to Vigil, there are about 61,000 undocumented workers in New Mexico who create jobs in key industries such as agriculture and oil and gas.

“We have partners who work with workers in the Permian Basin, and these jobs are really some of the most dangerous and unsafe. Accidents and injuries are very common there,” Vigil said.

He also pointed out that a large part of the state’s revenue depends on mining.

“Undocumented workers play a big role in this sector,” he said.

Vigil said that in addition to expanding tax breaks, there must also be efforts to better support workers in these industries to ensure their safety and support, as well as provide training for the workforce for jobs after fossil fuels are phased out.

“There are ways to make these jobs more secure, better paid and provide access to more diverse training programs,” he said.

Other industries where undocumented workers often fill gaps include hospitality and healthcare, Vigil says.

Additionally, undocumented workers pay more in state and local taxes on average than the top 1 percent of households in New Mexico and 39 other states. That’s because those taxes, including GRT, excise taxes, property and income taxes, make up a higher percentage of an undocumented worker’s income, Vigil said.

According to Vigil, those in the top one percent can, for example, claim tax deductions on capital gains taxes, allowing them to have a lower effective tax rate.

“When we say our tax code is regressive, it doesn’t mean that (illegal workers) pay more than the top one percent. What they pay is a larger percentage of their income,” Vigil said.

According to Vigil, gross income tax and personal income tax are the most burdensome for the lowest 40 to 60 percent of income groups because the tax represents a higher percentage of their income.

Vigil said a fair and equitable tax system would increase the income of higher earners.

Those in lower income brackets, including undocumented workers, “don’t have large assets to fall back on in an emergency,” he said.

“They live paycheck to paycheck and support a family. They should not bear the tax burden,” Vigil said.