Defunding the Taliban without starving the Afghan people

The US Senate Foreign Relations Committee has approved the bipartisan No Tax Dollars for Terrorists Act, marking a significant legislative move to prevent American taxpayer funds from directly or indirectly benefiting the Taliban or other designated terrorist groups in Afghanistan.

This measure signals a shift in US policy toward stricter financial controls and counterterrorism safeguards following America’s sudden military withdrawal and the Taliban’s return to power in August 2021.

Committee Chairman Jim Risch described the bill as a “commonsense” initiative to ensure that not a single US dollar reaches terrorist organizations in Afghanistan, underscoring the political and moral sensitivities surrounding continued financial flows after two decades of ultimately failed US military involvement.

The bill codifies US opposition to outside financial or material support that could strengthen Taliban control, and requires the US State Department to develop a strategy against foreign assistance diverted to militants.

The legislation, introduced in January 2025 by Senator Tim Sheehy alongside several Republican co-sponsors, now moves to the full Senate for consideration.

The initiative reflects mounting concern in Washington that humanitarian-driven financial flows intended for civilian relief may be reinforcing Taliban rule and indirectly enabling terrorism networks in its midst.

Since the Taliban’s return to power, international and humanitarian assistance have continued to flow into Afghanistan, even in the absence of formal diplomatic recognition of Taliban rule.

A December 2025 report by the US Special Inspector General for Afghanistan Reconstruction (SIGAR) estimated that roughly US$10.72 billion entered the country after August 2021, including about $3.83 billion funded by US taxpayers.

Some assessments cited in the report suggested that as much as 70% of these funds may ultimately have benefited Taliban structures through taxation, diversion or indirect administrative control.

Additional oversight findings indicate that approximately $4 billion in US assistance reached Taliban-governed systems after the fall of Kabul, while international aid organizations delivered nearly $8 billion in development and humanitarian support.

The multi-donor Afghanistan Resilience Trust Fund (ARTF) has financed projects worth around $1.5 billion, highlighting the continued scale of external engagement with the sanctioned Taliban regime.

Watchdog inquiries and international monitoring, among them assessments by the United Nations Security Council, have repeatedly pointed to fraud, diversion, abuse and weak oversight in the distribution of aid under Taliban governance.

Broader reconstruction reviews suggest that tens of billions of dollars allocated over the past two decades were lost to corruption or inefficiency. Afghanistan recently ranked 169th out of 182 countries in Transparency International’s 2025 Corruption Perceptions Index.

The legislation also reflects widening geopolitical and regional security anxieties. Policymakers and observers increasingly caution that unrestricted financial inflows could give extremist groups the space and resources to rebuild their operational strength, creating risks that extend beyond Afghanistan’s borders into the wider neighborhood.

Pakistan, in particular, has repeatedly raised alarms in multilateral fora about the continued presence of anti-Pakistan militant groups operating from Afghan territory, including an estimated 6,000 fighters associated with Tehrik-e-Taliban Pakistan (TTP). Afghanistan is believed to host roughly 20 international terrorist organizations, reaffirming the nation’s reputation as a center for transnational militancy.

These concerns were underscored by the UN Security Council’s 37th Monitoring Team report in February 2026, which documented a rise in cross-border attacks into Pakistan launched from Afghanistan and warned that militant activity inside the country remains a serious and evolving threat with the potential to destabilize the broader region.

As US and UN scrutiny grows, Afghanistan’s humanitarian crisis continues to worsen, leaving global policymakers and donors with a difficult dilemma. Millions of Afghans still rely on outside assistance for food, healthcare and other basic necessities.

The real challenge for the US and wider international community is therefore not whether aid should continue to flow, but how to ensure it reaches those in need without inadvertently reinforcing Taliban rule and terrorist activity.

Seen in this light, the proposed US legislation points toward the need for new ways of delivering aid, stronger oversight and tighter financial safeguards that prevent diversion while ensuring that life-saving support continues to reach Afghan communities in need.

Washington is now signaling that any future engagement with the Taliban must hinge on clear, verifiable conditions and benchmarks.

These include a genuine Taliban break with terrorist networks, concrete steps to prevent cross-border militancy, the formation of a more inclusive political order that reflects Afghanistan’s ethnic diversity, meaningful protection of women’s rights and broader adherence to internationally recognized human rights standards.

Taken together, these expectations point to an attempt by policymakers to balance the urgent need for humanitarian support with enduring counterterrorism concerns. In the months ahead, debate in Washington is likely to move from legislative intent to the more difficult matter of implementation.

Policymakers will have to weigh tighter financial restrictions against the risk of deepening Afghanistan’s economic collapse, while also designing monitoring mechanisms that preserve humanitarian access without enabling diversion.

The credibility of broader counterterrorism financing frameworks may hinge on whether this balance can be sustained in practice. Failure to do so could either deepen Taliban isolation without changing behavior or allow continued financial leakage that undermines regional security objectives.

All in all, the No Tax Dollars for Terrorists Act represents more than tougher technical oversight. It signals a broader recalibration of US policy toward conditional assistance, regional security stabilization and counterterrorism.

If passed as proposed, it is likely to shape how international donors and multilateral institutions approach Afghanistan aid and engagement in the years ahead.

The trajectory of US implementation — and the extent of coordination among China, Central Asian states and major international donors — will be critical in determining whether financial controls prop up regional stability or deepen Afghanistan’s economic isolation and security threat in the post-withdrawal era.

Saima Afzal is an independent and freelance researcher specializing in South Asian security, counter-terrorism, the Middle East, Afghanistan, and the Indo-Pacific region. She holds an M. Phil in Peace and Conflict Studies from the National Defence University, Islamabad, Pakistan.