The House Revenue and Taxation Committee voted 7 to 2 on Feb. 19 to pass with a favorable recommendation a second substitute for HB 284, a bill that would require money transmitters to withhold a 2% fee on international wire transfers when the sender does not present a qualifying form of identification.

Sponsor Representative Grama, presenting the bill, said the fee is a way to capture outbound money that does not return to Utah’s economy. “If you are sending a wire transfer to a foreign country and do not show ID, that you are subject to a 2% tax. This is refundable on your tax return,” the sponsor said, adding the fee aims to pick up revenue from people who do not file or remit state income tax and from senders who choose not to show ID.

The bill’s sponsor told the committee the fee is refundable as a tax credit, but clarified it is structured as a nonrefundable credit at the commission’s request to limit fraud: “That is correct. That was at the request of the tax commission to help cut down on fraud.”

Supporters, including conservative policy advocates, framed the measure as a public-safety and revenue tool. Ashley Hayek, president of America First Works, testified the fee could help deter criminal networks and generate revenue for law enforcement and public services, citing data from other states and national studies she said link remittance flows and illicit activity.

Industry witnesses and trade groups strongly opposed the bill. Adam Fleisher, counsel for the Money Services Roundtable, told the committee the fee could undermine anti–money-laundering efforts and push customers to unregulated channels. “The cost will encourage Utah residents to turn to unregulated and unmonitored alternative channels to transmit money,” Fleisher said, and he cited implementation and administrative challenges, including the recordkeeping required by the federal remittance transfer rule.

Trades representing money services businesses and banks — including the Utah Money Service Business Association, Utah Credit Union Association, and Utah Bankers Association — said licensed transmitters already follow federal Bank Secrecy Act requirements and that a tax on transmitters but not banks would distort competition and risk driving transactions out of regulated networks.

Committee members pressed the sponsor on practical questions: how institutions would record ID presentation, whether foreign passports or visas qualify, and how minors or customers without ID would be treated. The sponsor said the tax commission would receive rulemaking authority to set reporting and implementation details and that some categories of foreign IDs (including certain visa-bearing passports and diplomatic IDs) are exempted in the current substitute.

On final tally the committee recorded two no votes (Representative Daley Provo and Representative Noe Winn); the motion to pass out the second substitute succeeded 7–2. The committee also adopted the second substitute earlier in the hearing and then voted on the favorable recommendation.

What’s next: with a favorable recommendation the bill moves to the House floor for further consideration. Committee sponsors said they are open to additional technical fixes and working with industry on implementation details.