How much does immigration cost taxpayers? A study analyzed the fiscal impact of immigrants in the United States

The education level, age, and origin of immigrants are the keys to determining whether they will be a fiscal burden on the United States. Daniel Di Martino, for the Manhattan Institute, conducted the research, which studied the cost of immigration projected over ten and thirty years.

In the midst of a national debate over how to proceed with immigration, the study yields some illuminating points when debating what federal policy should be for illegal immigrants who entered during the past few years under the border crisis of the Biden Administration.

For example, one of the loudest proposals in recent months was the Dignity Act. Pushed by María Elvira Salazar, the bipartisan bill seeks to combine border security with a path to legality for undocumented immigrants who do not have a record, have been in the country for five years, and pay a fine to fund the process.

What is the fiscal impact of immigration?

To prepare the report, Di Martino adapted his methodology to that of the Congressional Budget Office, which allows the results to be directly applied to the fiscal evaluation system of federal legislation, evaluating results over ten and thirty years.

In this opportunity, the main finding is that there are many types of immigrants, so lumping them all into the same bag is unfair. Key factors of those arriving in the United States must be taken into account, such as education level before entering the country, age, and origin.

"Overall, the average new immigrant reduces the federal budget deficit and expands the economy, but this is not true of all categories of immigrants," the study notes.

For example, immigrants who come to the country with a college degree generate more money in taxes than they receive in government benefits. Over time, this has a positive fiscal impact and helps lower the public debt.

However, the case of the less qualified is different. In addition to failing to pay back more to the government than was spent, the calculation is even worse if one takes into account their descendants, who tend to be more, and in most cases do not make it to a college degree.

Fiscal cost according to the origin of immigrants

On age, the study explains that it is an equally important point: "Older immigrants may appear fiscally positive in the short run because they contribute payroll taxes without drawing on entitlements, but over 30 years, they often become net burdens as Social Security and Medicare."

When it comes to country of origin, Middle Eastern and Asian immigrants tend to have an average, positive fiscal impact. In contrast, Latin Americans, especially Mexicans and Central Americans, are "the only national origin group with a negative fiscal impact."

According to the study, the immigrants who would most reduce the national debt over the next 30 years are those from India, China, and the Philippines, in that order. The immigrants who represent the largest tax burden are Salvadorans, who increase the national debt by more than $50,000 over 30 years, followed by the largest group, Mexicans, who, on average, increase the national debt by $10,000 each over 30 years.

If we go to the regions, European and Asian immigrants would generate a positive impact of approximately one million dollars over this period of time, followed by Africans and Middle Easterners. Third place went to Latin Americans, with a net positive impact of $150,000.

What about legal and illegal immigrants?

According to the Manhattan Institute study, the difference for U.S. taxpayers is substantial.

"The average new legal immigrant will pay $350,000 more in taxes than he/she receives in government benefits, while the average new unlawful immigrant will cost the U.S. taxpayer $80,000 more than he/she will pay in taxes. Unlawful immigrants already living in the U.S. are much worse fiscally than new ones because they are older and because previous unlawful immigrants have less education than new ones. Therefore, the average unlawful immigrant residing in the U.S. will cost the federal government $225,000 more than he/she will pay in taxes over the next 30 years," the study added.

Finally, the report's author stated that while fiscal costs should not be the sole unit of measurement for immigration, it "is a crucial and quantifiable measure of the long-term national interest."