Confirming reports passed on by commenters at the Isaac Brock Society, DiploPundit points to a State Department interim rule just placed on public inspection for printing in tomorrow’s Federal Register, which raises the fee for renunciation of U.S. citizenship (but apparently not relinquishment) to US$2,350, more than twenty times the average level in other high-income countries. As they state:
[D]emand for the service has increased dramatically, consuming far more consular officer time and resources, as reflected in the 2012 Overseas Time Survey and increased workload data. Because the Department believes there is no public benefit or other reason for setting this fee below cost, the Department is increasing this fee to reflect the full cost of providing the service. Therefore the increased fee reflects both the increased cost of the provision of service as well as the determination to now charge the full cost.
The Universal Declaration of Human Rights states that “No one shall be arbitrarily deprived of his nationality nor denied the right to change his nationality”, while the Expatriation Act of 1868 says that renunciation of citizenship is “a natural and inherent right of all people” and that “any declaration, instruction, opinion, order, or decision of any officers of this government which restricts, impairs, or questions the right of expatriation, is hereby declared inconsistent with the fundamental principles of this government”.
As of press time, the State Department has not yet commented on whether it sees “public benefit” in other human rights such as freedom of election or freedom of marriage, or whether anyone seriously believes that charging people a month’s salary to get a ballot paper or a marriage certificate would not restrict or impair those rights.
Practical effects
Because this fee hike apparently does not apply to relinquishments, ex-Americans who naturalise in most other countries will still be able to obtain a Certificate of Loss of Nationality from the U.S. government for no more than the cost of taking a day off work and driving or flying halfway across the country to the nearest consulate which isn’t backed up for months with renunciation appointments. (“Most other countries” means those which allow dual citizenship, like Canada and France, or those which forbid dual citizenship but allow new citizens to submit proof of loss of their former citizenship after the naturalisation ceremony, like Japan.)
However, Americans seeking to naturalise in countries which require new citizens to give up their former citizenship before the naturalisation ceremony, like Taiwan, or those who have been foreign citizens for decades or all their lives and never exercised any benefits of U.S. citizenship but now need to acquire a formal CLN (for example because their bank will discriminate against them if they don’t have one), will feel the full impact of the new fee hike, and also have to wait for months or even longer than a year for the State Department to give them a CLN before they can get on with their lives.
What changed?
The State Department has always claimed that processing renunciations has a high cost, but four years ago when they first introduced the renunciation fee, they at least pretended to take a very different attitude to the cost:
The CoSS demonstrated that documenting a U.S. citizen’s renunciation of citizenship is extremely costly, requiring American consular officers overseas to spend substantial amounts of time to accept, process, and adjudicate cases. A new fee of $450 will be established to help defray a portion of the total cost to the U.S. Government of documenting the renunciation of citizenship. While the Department decided to set the fee at $450, this fee represents less than 25 percent of the cost to the U.S. Government. The Department has determined that it must recoup at least a portion of its costs of providing this very costly service but set the fee lower than the cost of service in order to lessen the impact on those who need this service and not discourage the utilization of the service, a development the Department feels would be detrimental to national interests. See 31 U.S.C. 9701(b)(2).
They also note the per-hour cost they use to calculate the new fee:
The Department previously charged a consular time fee of $231 per hour, per employee. This fee is charged when indicated on the Schedule of Fees or when services are performed away from the office or outside regular business hours. The CoSM estimated that the hourly consular time charge is now lower. Accordingly, the Department is lowering this fee to $135 per hour.
This implies that they take about seventeen employee-hours to process each renunciation (assuming that none of the fee goes to other expenses such as travel or printing). Oddly enough, in their 2012 Paperwork Reduction Act filings on Form DS-4079 (which is filled out by both renunciants and relinquishers), the State Department indicated that the cost for processing the form was just $33 per hour. I don’t understand how these two estimates relate to each other.
To explain the new fee hike, the State Department point to procedures (such as the pointless and repetitive double in-person appointment system) which are required neither by the Immigration and Nationality Act nor the Foreign Affairs Manual, nor used by any other countries:
For example, consular officers must confirm that the potential renunciant fully understands the consequences of renunciation, including losing the right to reside in the United States without documentation as an alien. Other steps include verifying that the renunciant is a U.S. citizen, conducting a minimum of two intensive interviews with the potential renunciant, and reviewing at least three consular systems before administering the oath of renunciation. The final approval of the loss of nationality must be done by law within the Directorate of Overseas Citizens Services in Washington, D.C., after which the case is returned to the consular officer overseas for final delivery of the Certificate of Loss of Nationality to the renunciant. These steps further add to the time and labor that must be involved in the process.
As demonstrated by the experience of other countries, the State Department could greatly lower their costs by simplifying their procedures, but apparently such a common-sense step has not occurred to them.
But look on the bright side! 31 USC § 9701 says that “[e]ach charge shall be … based on … (A) the costs to the Government; (B) the value of the service or thing to the recipient; (C) public policy or interest served; and (D) other relevant facts.” Given how valuable a CLN has become these days, imagine how high a fee they could charge for it if they set the price based on its value.
Timeline for fee hike and comments period
The State Department ends with an excuse for why they can’t be bothered to tell us about the fee hike more than two weeks in advance, while keeping renunciants waiting for dozens of times that long to get the CLNs in the first place:
The Department intends to implement this interim final rule, and initiate collection of the fees set forth herein, effective 15 days after publication of this rule in the Federal Register …. The Department is publishing this rule as an interim final rule, with a 60-day provision for post promulgation comments and with an effective date less than 30 days from the date of publication, based on the “good cause” exceptions set forth at 5 U.S.C. 553(b)(3)(B) and 553(d)(3). Delaying implementation of this rule would be contrary to the public interest because the fees in this rule fund consular services that are critical to national security, including screening visa applicants.
You have until 4 October to submit a written comment on this rule. I will update this post with a link to the docket page on Regulations.gov once the fee hike is officially published.
Maz57….I’m totally in your camp. I refuse to dance. They’re not very attractive.
@maz57: one guy in Ireland has just done precisely that:
http://www.nolanchart.com/citizenship-renounced-usg-denounced?PageSpeed=noscript
Incidentally, this is pretty much the same procedure which the Irish government requires of its own citizens for renunciation: fill out a “Declaration of Alienage”, get it witnessed by a public official or a member of a licensed profession, and drop it in the mail. No in-person appearances, apparently no fees, and you can make a new “Declaration of Citizenship” to get your Irish citizenship back any time you want.
…and with the correct use of two words, “Renounce” and “Denounce”:
All the best, Mr. Kusumi.
Patrick Kusumi is AWESOME. 🙂 My favorite line is this: “The date that the US Government can go jump in a lake is any day and every day, effective immediately”. Absolutely superb and polite.
I wish I were as eloquent in what I’d like to say to the United States Government.
@everyone, why can’t ppl just do what this guy did? It’s a public declaration that’s being duly witnessed. If you live in an IGA country, like Canada, the banks have to accept it, right? What can the USG really do to you if you never set foot there again?
Maybe we need another campaign like the “I am not a myth” where people can renounce.
Similar to:
Fight back: http://www.adcs-adsc.ca/
I’d argue that it is of great public benefit to the US to avoid creating barriers to renunciation for people who clearly don’t want to be US citizens anymore.
It is ironic that citizen based taxation was instituted in America during the US Civil War. The war was to free the slaves in the USA BUT it actually this law made slaves of all US citizens at home and abroad. There is no real freedom in the USA.
I don’t think they even know what freedom is, Northernstar. But then, none of us really do, do we?
I’m going to start making the assumption that those who say that CBT is here to stay want to keep it. When did capitulating to anything ever change it?
This sounds like a good alternative. I am getting so stressed and tired of all this BS and everything that we have to read up on – I will definitely consider this alternative. I think it sounds like a good one.
I don’t think there is much hope that the USG will receive Form 8854 from Patrick Kusumi !! Bravo!
Mr. Kusumi’s exercise is cute and all, but it has no legal effect.
8 U.S. Code § 1481
a) A person who is a national of the United States whether by birth or naturalization, shall lose his nationality by voluntarily performing any of the following acts with the intention of relinquishing United States nationality
(5) making a formal renunciation of nationality before a diplomatic or consular officer of the United States in a foreign state, in such form as may be prescribed by the Secretary of State
He claims he’s renouncing per INA349(a)(5), but he isn’t even doing it per the plain reading of the statute.
That said, unless he’s trying to make a political protest, his youtube video has no significance. They get to collect your $2,350 regardless.
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Compare the 2350. US fee to the average weekly earnings of a Canadian:
http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/educ05-eng.htm
http://timesofindia.indiatimes.com/World/US/US-raises-5-fold-the-fee-to-renounce-citizenship/articleshow/42411402.cms
Repeats distortions about “most” renunciants being rich socialites and star millionaires making a fortune inside the US and then leaving to save on taxes – while simultaneously the author describes that renunciants don’t want to pay taxes on salaries earned abroad. Usual drivel.
Good Evening All,
I thought I would give an update. I went to the consulate in Tijuana on Thursday. I renounced on the last day of the “cheap’ fees. But it did not go with out some nervous moments on my part. I will give a brief detailing of my experience. I had a phone interview on Monday and the consulate staff were very friendly and accommodating on the phone. The allowed me to have a phone interview because I was unable to make it down to the office for the two interviews. So I flew down to San Diego on the Wednesday got in around 130. So I had Wednesday afternoon to hang out in San Diego which was much nicer then being in Calgary that morning. When I left I had about 6 inches of snow in my driveway. What a silly joke this weather was. Ugggg.
My appointment was for 2pm on Thursday afternoon. I took the trolley in San Diego from where I was staying to the international border and walked across the border into Tijuana. Tijuana was not nearly as scary as I remember it from a few years ago. So once I was across the border I went and caught a cab and got to the American Consulate. I got there about an hour early and I was left sitting there waiting for my appointment. The guard went into the consulate and confirmed that I had a 2pm appointment with the consular officer. So at 2pm I went and talked to the guard and he said he hadn’t heard from the officers yet. So I was starting to get nervous that I wasn’t going to make it in. It was finally 2:15 before I got into the waiting room area. I waited another 15 minutes or so before they finally got me into the private room for the interview. So we started the interview. And after a couple of minutes they asked if I had paid for the “privilege” to renounce. So I went to pay for the renunciation and pulled out my credit card and they said don’t you have cash. I was told that I could pay cash or credit card. So now I am freaking out again because they said that they did not have the credit card option available because there head cashier had already left for the day. So here I am thinking that I have come half way accross the continent and I am going to miss the “cheap” fees because of a stupid bureaucratic mess. But as challenging as this went I finally got to pay via credit card. So I had to wait again for about 15 minutes while I was waiting for them to figure out the credit card issue and then another 15 minutes after I payed for the renunciation before I finally got into the do my renunciation.
Once I finally got into the interview again. I had a moment of honesty that I wished I would not have answered the questions the way that I had. They asked why I was renuncing and I told them that I was doing it because being compliant was just too cumbersome and expensive to maintain my USA citizenship. This had me really nervous because I thought they may view this as renouncing for taxation purposes thus making me a covered expat and potentially having me barred from entry into the States. I was really quite concerned but because of the helpful people here at IBS I was able to take a deep breath do to the advise that was given. Thanks to everyone for your advice.
So some thoughts about the whole experience. The staff in Tijuana aside from being a unfamiliar with the whole process they were reasonable to deal with. There was no rudeness, enmity or aloofness on their part. The gentleman who was doing the interview said that this was his first renunciation in the three months that he had been in this part of the consulate. The had a bunch of notes in front of them in order to help them complete the renunciation process. Neither of the individuals that I chatted with seemed to have much experience in processing these claims. If anyone is looking to do the renunciation quickly it seems to me that arranging with either Tijuana, Hermosillo or Nassau would be an option. Obviously this will cost more to do it outside of your home country, but these seem to be quicker options for those who no longer wish to be an American citizens.
Cheers.
Wow, krackerjack. So glad that’s behind you and you got in before the fee increase — yay! Thanks for giving us such a detailed update. I hope they gave you some proof of purchase (i.e. a receipt). How was the journey home without your U.S. passport? Why aren’t retired expats living in Mexico flocking to the consulates? Are they unaware of FATCA? Any ideas? Anyway it looks like you got the Tijuana consulate staff going on the renunciation learning curve.
@ krackerjack121
Congratulations! Glad to here that it went (relatively) well. The fact that no one has relinquished or renounced in Tijuana in 3 months is in sharp contrast to the rush in Canada, in spite of Mexico reportedly having an even larger number of US citizens. It would seem that the US citizens in Mexico mostly intend to remain that way.
@ EmBee
I have read that most of the US retirees in Mexico keep their money in the US and draw on it as needed. It seems they’re running into some problems with wiring funds and maintaining some investment accounts in the US, but with little funds in Mexico, there are no FBARS to file or other similar problems that face “US persons” who become more immersed in their “foreign” country of residence – no foreign earned income, no substantial foreign bank accounts, etc
@ TokyoRose
Ah so that explains it! I personally could not imagine having my money in a foreign (as in not where I’m residing) country. I like to keep it down the street, even though I know that banking anywhere is an illusion. Once they have it, they control it.
@krackerjack121
I’ve been following you and I have to say congratulations on making it under the wire! What an incredible story, actually the kind of stuff books are written about. Thank you for taking us with you on your journey to emancipation.
I thought I heard that 75% of the most recent renunciations are in Canada, the UK, and Mexico. If few are from Mexico, the bulk must be from Canada/the UK. Of course, any trends that existed prior to the fee hike are sure to be skewed now that people will have to take out mortgages to renounce US citizenship.
@Krackerjack
I’m assuming you traveled on your foreign (Canadian) passport, but your journey does pose an interesting dilemma.
In many countries it is law for dual citizens to travel within their country of citizenship on that country’s passport, so if you’re an French and a British citizen you must use your British passport in Britain, but can use either passport when in a third country. There are reports here of the US attempting to enforce this, but I’m not sure if it’s law.
Anyway, given your trip from San Diego to Tijuana. If the Americans forced you to travel south on a US passport, and then that passport was invalidated as part of the renunciation procedure, you might have had difficulty departing. I suppose strictly you could have used your Canadian passport exclusively for the Mexican formalities but one might get anxious switching passports between adjoining border posts, especially if the Mexicans wanted to see proof that you formally left the US (i.e. didn’t skip past the US border post). If you happened to encounter the same US border control agent on the way in, who had insisted you depart on a US passport, you might have had some difficulty convincing him that you’d lost your US citizenship in the hour since he last saw you.
This probably isn’t much of an issue for US/Canadian/Mexican passport holders, but imagine trying that with a passport that required both US & Mexican visas.
I could just imagine the CBP guard’s face going back to San Diego from Tijuana–“What were you doing in Mexico? — Renouncing my US citizenship…”
Thanks for the report of your memorable renunciation, Krackerjack, on the last day of ‘bargain rates’. I’m so glad that in the end your credit card was able to be used for payment. Congratulations on your decision to travel south for your expatriation (and for escaping another unforgettable day in Calgary).