Taxing remittances are just fine if they use a bank. But they’ll just switch to money orders. USPS and check cashing joints sell tons of them to Illegals now.
All we have to do is send less foreign aid.
$209 B(+) disbursed to Mexico in foreign aid in 2012.
Easy enough to fix with some administrative rules. For example, if you're buying a money order and you cannot prove that you are a CITIZEN, there's a XX% tax that'll be withheld. If you're a citizen, no tax. If you are a legal permanent resident...OK, provide proof of the tax payment to the IRS, and you can deduct it as a withholding tax. Thus, all such payments by illegals, people here on work visas, people here who have overstayed their visas, etc. will be taxed.
And it all ends up in the pockets of the Mexican ruling class.