Public witnesses urge committee to reject bill adding 1.5% fee to some international wire transfers

Representative Fiddler introduced House Bill 585 and described a package of changes that would add a 1.5% fee to outgoing international electronic wire transfers originating in Alabama, create reporting and recordkeeping duties for licensed money-transmission businesses, and direct collected fees through the Alabama Securities Commission to the Office of Prosecution Services for distribution to county sheriffs.

The sponsor said the bill, effective Jan. 1, 2027, would also create an Alabama income tax credit equal to wire transfer fees paid (capped at $5,000, nonrefundable and not carry-forwardable), require transmitters to display a Department of Revenue notice about the credit, authorize the Alabama Securities Commission to assess civil penalties for violations, and establish criminal penalties for knowingly attempting to evade reporting requirements. Representative Fiddler said the measure includes a legislative review committee and a sunset provision that would repeal the fee and credit in 2030.

Public witnesses who registered opposed the bill said it would duplicate existing federal and state oversight, increase costs for low-income Alabamians, and target immigrant communities. Jim Barton of Barton and Kitty, representing Remittly, told the committee, “This legislation is unnecessary. It duplicates existing oversight without improving it,” and warned the measure would “stack regressive taxes on law‑abiding Alabamians” by layering a new state fee atop existing federal remittance charges and income taxes.

Allison Kenny, who said she represents Remittly through Barton and Kenny, argued the bill would hit junior enlisted military families, missionaries and faith-based mission partners. “The goal of this legislation…is stated is to cartel money transfers for illicit purposes,” she said, and added that many of the intended enforcement targets are already covered by state and federal law. Carlos Aier Torres of the Hispanic and Immigrant Center of Alabama said the proposal amounted to “another tax that is going to be imposed on all Americans,” and noted the tax credit in the bill is not refundable, meaning many low-income senders would not receive immediate relief.

Cindy Garcia, introduced herself as president of Kalera Labama and a business owner, said the bill would “target” immigrant communities and punish workers who already contribute to the state economy. Witnesses also warned of indirect effects on small businesses that engage in international trade.

Representative Fiddler said the bill’s drafters narrowed the measure after community feedback: bank-to-bank transfers and many peer-to-peer “cash app” transactions are excluded, and the sponsor emphasized the tax credit as a mitigation measure. She described prior fiscal work showing a 4% fee would have produced at least $10 million in revenue and said the reduced 1.5% rate would yield far less (she cited an informal estimate in the neighborhood of $4 million at the higher rate adjusted downward for the smaller fee). The sponsor also noted Oklahoma has implemented a similar fee and said staff from the Alabama Securities Commission were present to answer reporting and compliance questions.

Committee members asked whether the bill would conflict with federal law; the sponsor said she would research preemption questions. Several lawmakers pressed on the bill’s potential effects on deployed service members and mission partners who send money overseas; the sponsor reiterated that many common bank and app transfer methods had been excluded from the fee language.

No vote was taken. The committee closed the public hearing and moved to adjourn, leaving HB585 under consideration for a later decision.