New Delhi, May 18 -- An American proposal to tax money sent abroad by non-US citizens is raising concerns in India. If passed, this 5% tax on remittances could significantly impact Indian households and the country's currency, potentially causing India to lose between $12 billion and $18 billion annually in foreign currency inflows, according to a report released by trade think tank Global Trade Research Initiative (GTRI) on Sunday.

The tax is part of a bigger legislation, dubbed "The One Big Beautiful Bill," introduced in the US House of Representatives on 12 May. It targets money transfers made by people who are not US citizens but live and work there, including those on work H-1B and H-2A visas.

US citizens would not have to pay this...