Senators to Unveil the ‘Ex-Patriot Act’ to Respond to Facebook’s Saverin’s Tax ‘Scheme’
The Saverin fall-out, as expected, has begun:
Key quote:
The senators will call Saverin’s move an “outrage” and will outline their plan to re-impose taxes on expatriates like Saverin even after they flee the United States and take up residence in a foreign country. Their proposal would also impose a mandatory 30 percent tax on the capital gains of anybody who renounces their U.S. citizenship.
The plan would bar individuals like Saverin from ever reentering the United States again.
What does this mean? Can we never be free from these people? Is this implying that if you renounce citizenship now even with under the 2 million in assets that you will end up paying capital gains taxes anyway? And what is this about “re-imposing taxes on expatriates”? Does that mean that renouncing citizenship doesn’t do anything and that there would be no way to get out of the US net? Personally I couldn’t care less if they ban me from travelling there, but this has me very alarmed at what is going on. I just want to get rid of this unwanted, accidental citizenship and get about living my life in my own country!
@rodgrod: this guy gorging himself on credit. Sound familiar?
It was Chuck Schumer who proposed that? He does think about his proposals, just not with the best intentions. At the time, I realized that the proposed new visa for those who buy US real estate was a trap, because one of the requirements for the visa was that the person would have to physically be in the US for at least half of the year, therefore becoming a resident for tax purposes and paying tax to the US on worldwide income.
@omg, America is what happens when every mother’s dream of having a lawyer for a son comes true.
Both the Republicans and Democrats don’t want to admit it’s going to take big tax rises to fix things cutting won’t be enough. They want to con Americans that taxing Saverin is a way out of their problems. Ironically his tax bill would’ve been about $600M not far short of projected FATCA revenue of $800M. Congress will wait for a bond or dollar crisis before taking real steps forward. Each and everyone of them are wankers for not telling America the truth.
Hoping this does not distract from criticism of FATCA in the media ; there is little enough coverage out there as it is. Anyone with access to a database like Lexis-Nexis (usually a corporate, legal or academic library) can do a newspaper/media search and see how many results they get for FATCA in the news (will be US media, but maybe some global as well). Just from doing this informally online for the big papers in Canada hasn’t yielded as much as you would think given the implications – and yet it will have such far-reaching effects.
The US is like an ex-top model who’s past her prime, who knows nothing but to react with rage and revulsion when jilted by her young lovers. In fact she’s powerless but doesn’t want to acknowledge it, so she plots her revenge. This seems to only be obvious to observant outsiders.
There will be very little opposition to any new and outrageous laws that Congress will enact. There will come a day when it will become impossible (or nearly impossible) to expatriate.
Let’s see if we can name all the places in the world that are hard to escape from:
– North Korea
– China
– Cuba
– USA
Wow they’re in good company.
@rødgrød
“…..I wonder if a foreign citizen can become an enrolled agent?”
A Foreign citizen maybe.
A U.S. “EX-PATRIOT” definately NOT 🙂
John said: “They want to con Americans that taxing Saverin is a way out of their problems.”
Saverin is a distraction from the real story which is hello average Joe American your taxes are about to go through the roof. Lost your house and your job doesn’t pay well? That’s too bad the government needs more of your money because while you’ve been frugal due to necessity they’ve been spending like maniacs.
@omg, and they may end up paying more taxes than those of us in countries who have better social programs, education and health care. Truly sad. But the are free!
@wellington- I believe that you are correct. Leaving the country will also become more difficult unless the airline industry has something to say about it.
Speaking of social programs. I’m sooo glad I live in Canada. Since age 40 I’ve been getting yearly checkups and my doctor sends me to get mammograms every two years. I think it’s a bit over the top since my family has zero history of breast cancer but it’s nice that she cares so much.
This year after I went to get the mammogram, the diagnostic centre called me back and said they saw something and wanted me back in to make sure there isn’t something there. Good news I went for the second mammogram today and they gave me the all clear. I’m celebrating with Strawberry Shortcake.
@omg, congratulations on the all clear and the strawberry shortcake. Had they found something, they would have been quick to respond, contrary to what most American’s believe about our health system. Canadians are generally more healthy than Americans:
http://www.ctv.ca/CTVNews/Canada/20060530/canada_us_healthcare_060530/
@omg, Congratulations!! Great news!!
Yes, great news, @omg!! I’ll bet you’re so relieved..
@OMG: Congrats. It’s a bit early for strawberry season in Ontario, so I hope the strawberries aren’t from the US. In any case, Enjoy!
Thanks bubblebustin and saddened123. I was pretty anxious this morning, but am now relieved.
I’m surprised at how good the healthcare system has been for the last few years which is the first time I’ve ever really needed it.
A few years ago, I started having serious problems with my lady parts. My doctor sent me in for tests and then quickly to a specialist. He booked me for a hysterectomy within a month of my first visit to him. That was awesome. Best of all cost was 0.
And now with all this anxiety caused by the Great Recession and all around American madness, I’m lucky to be in the care of an amazing psychiatrist. Again cost is 0. I was really on the ledge by the time I decided to seek help.
@Blaze, the strawberries look really fresh so they’re probably imported from somewhere. I got the cake from Longos, their cakes are so good.
America will definitely not shift to a residence-based taxation anytime in the near future…but I’d imagine they’ll shift their focus to wealthier expats for audits and OVD programmes. So though it’s getting crazy out there, I feel more optimistic that my QD last year will go smoothly.
Has this article from New York Times been posted already? I’m losing track.
http://www.nytimes.com/2012/05/17/technology/a-facebook-cofounder-reflects-on-the-path-forward.html?_r=2&ref=business
This gives a bit more info from Saverin’s own perspective, but I think an interview with him directly would be very interesting. I wonder if Barbara Walters would consider him as one of the Most Fascinating People of 2012. He has certainly attracted attention.
Do you think he might be interested in joining Brock?
@omg, Great news, enjoy your cake.
From what I hear from my Chinese friends, it doesn’t seem hard to leave China. I guess they have so many people that they don’t mind when one leaves. And neither China, Cuba or North Korea taxes its citizens who live abroad. In fact, officially North Korea doesn’t even have taxes. I’m not defending these countries, just putting the US in perspective.
@Petros
Great job engaging with Al Lewis!
I am looking forward to reading his latest piece.
@monalisa1776, I don’t really understand why the US wants to keep citizenship-based taxation when the rest of the world doesn’t. The population of countries like Andorra and Monaco is made mostly of foreigners, wealthy Europeans that decided to move there to avoid taxes, and their original countries don’t complain about this. Why do Americans feel so offended when one leaves the US?
@Shadow, I ask myself the same question! *lol*
I believe it’s a moral issue with them.
Senators Schumer and Casey are upping the ante for long term expats who just want to get on with their lives.
I haven’t seen the actual text of proposed bill, but according to CBS news:
“Under their legislation, any American who renounces his or her citizenship for the purpose of avoiding taxes will be punished in two ways: They will be barred from re-entering the U.S., and their future investments in the U.S. will be taxed at a 30 percent rate.”
http://www.cbsnews.com/8301-503544_162-57436316-503544/dem-senators-introduce-bill-to-punish-facebook-co-founder-eduardo-saverin/
This is not only about Severin; its also about the other 1,787 expatriations last year. Severin just happens to be the poster child.
As my grandfather used to say, “a horse always kicks the hardest just before it dies.”
I predict Schumer and Casey’s proposed bill will completely backfire when it comes to long term expats.
Renunciations / relinquishments will now rapidly increase. Six million expats can’t be kept inside the “GULAG” of citizenship-based taxation forever.
In the name of America’s founders, RENOUNCE and be FREE!