Immigrants contributed trillions more in taxes than they received in benefits: Study

Immigrants in the United States contributed trillions more in taxes than they have received in public benefits over nearly 30 years, according to a new report from the libertarian-leaning Cato Institute, as the national debate over mass deportations continues.

The study found that between 1994 and 2023, the immigrant population paid $10.6 trillion more in taxes than they received in benefits, noting that fiscal gain also meant governments did not have to borrow as much money, reducing costs in interest payments by $3.9 trillion, for a total net savings of about $14.5 trillion.

The report also highlighted that immigrants accounted for $4.8 trillion of the U.S. gross domestic product in 2023 alone, meaning their removal would significantly shrink the economy and workforce.

“Immigrants pay a lot of taxes,” said Adrian Espinoza, an IRS enrolled agent in San Diego who prepares taxes for immigrants, including many who are undocumented.

“Many of them do file a tax return primarily because they want to have a good sense of compliance in the United States,” Espinoza said.

The report was released Tuesday, as tensions continue nationwide over enhanced immigration enforcement that has also closed many legal pathways to enter the U.S.

“The perception is that they’re takers. The perception is that they use too many public benefits,” said Alor Calderon, director of San Diego’s Employee Rights Center.

Calderon says that perception is deeply offensive to many of the immigrants he works with.

“They’re very ashamed and they’re very, you know, incensed by it. They’re angry that they’re treated like that,” Calderon said. “Obviously, it’s not like they speak out too much because they’re very dignified, working hard people. But they feel very insulted by it.”

According to the study, immigrants are more likely to be of working age, often arriving in the U.S. as young adults and leaving before retirement. Undocumented workers also pay into Social Security and Medicare but are not eligible to receive benefits.

“That money is going to fund the benefits that we Americans are receiving, but they will never be eligible for it,” Espinoza said.

The report also notes immigrants are about half as likely to be incarcerated as U.S.-born citizens, which results in lower prison, policing and court costs. They are also less likely to be in school and generally in better health than the U.S.-born population, resulting in lower education and health care costs.

Espinoza says recent tax law changes mean many immigrants now do not qualify for new deductions, such as no tax on tips or overtime, and some are paying significantly more.

“I’ve been seeing people pay double their taxes,” Espinoza said.

He says data sharing with Immigration and Customs Enforcement has also caused fear among immigrant taxpayers.

“People have lost the trust in the IRS and keeping their information confidential,” Espinoza said.

The Cato Institute says removing immigrants would not only eliminate their tax contributions but also reduce the labor force and economic output, compounding the financial impact on the country.

This story was originally reported for broadcast by NBC San Diego. AI tools helped convert the story to a digital article, and an NBC San Diego journalist edited the article for publication.