The Fiscal Impact of Immigration in the United States

Alex Nowrasteh, Sarah Eckhardt and Michael Howard
Date of Publication: 
March, 2023
Source Organization: 
Cato Institute

How has immigration impacted government tax revenues and costs throughout the U.S., and how will it continue to do so in the future? In answering these questions, Cato researchers updated a pioneering 2017 study done by the National Academy of Sciences (NAS). The NAS report only analyzed data up until 2013. Cato updated the data but presented it in two ways: first, following the NAS model; and second, making certain revisions to the NAS model to capture information missing from the NAS report. Their findings indicate that immigrants have a more positive net fiscal impact than native-born Americans, with those arriving at the age of 25 and who are high school dropouts having a net fiscal impact of +$216,000. This is striking when compared to the associated native-born cohort, which sees a net fiscal impact of -$32,000. Even when the fiscal impact of immigrants is negative, as is the case in some state and local governments, it is still generally more positive than their native-born counterparts. On the federal level, revenues consistently rise above expenditures in response to immigration. The authors can say with confidence that immigrants are a net fiscal benefit to the United States.

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Nowrasteh, A., Eckhardt, S. and Howard, M. (2023, March). The Fiscal Impact of Immigration in the United States. Cato Institute.