NC Budget and Tax Center

Immigration reform would benefit North Carolina’s economy

The author of this post is Jelicia Diggs, an intern with the NC Budget and Tax Center

Comprehensive immigration reform will result in revenue gain for states, according to an economic and a fiscal analysis prepared by the Congressional Budget Office on the Senate Immigration reform measure last week. CBO projects that this bill will increase the labor force and expand the American economy by increasing the number of non-citizens allowed to lawfully enter the United States on both temporary and permanent bases.

Immigrants play an essential role in sustaining the economy of North Carolina, and currently comprise nearly 10 percent of the state’s work force. With the adoption of this bill, North Carolina, along with the rest of the U.S., will see economic gains. These gains will outweigh the costs anticipated from the expanded eligibility for public services.

In North Carolina, the ten-year cumulative increase in the Gross State Product will be $34.7 billion and the increase in earnings of all state residents will be $19.3 billion according to a state-by-state analysis completed by the Center for American Progress (CAP). And, CAP also projects that immigration reform would create an average of an additional 5,000 jobs annually. Undocumented workers currently residing in North Carolina would also see increases in their earnings and taxes paid.

In 2010, undocumented immigrants in North Carolina paid an estimated $317.7 million in taxes. However, at this rate, these residents are working low paying jobs and not able to contribute their full potential to the workforce because they lack the proper documentation. With the adoption of this bill, those currently residing in the U.S. without authorization will see more opportunities for employment in higher paying jobs and thus be able to pay more taxes. Over the ten-year period, undocumented immigrants in North Carolina are projected to earn $16.1 billion more and pay an additional $1.5 billion in state and local taxes on these earnings.

By granting legal status and mapping out a road to citizenship for undocumented immigrants, the American economy will see tremendous growth. American citizens and undocumented immigrants will see a growth in their income, job growth, and states, including North Carolina will see an increase in taxes paid.

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