To bring the subject of one of Eric’s posts back to the forefront, State Department to hike renunciation fees to US$2,350; says “no public benefit” in respecting human right to change nationality, I add another article, today, from the U.S. — Wall Street Journal, Laura Saunders, August 30th: U.S. Fee to Drop Citizenship Is Raised Fivefold. Commenting is open and comments have started.
Advocates for U.S. expatriates reacted angrily to news of the increase. “I’m so disappointed and insulted by the continuing punitive actions of the U.S. in trying to prevent persons and companies from leaving,”
Also from the U.S., which complements the articles on higher fees for renunciation, one from the U.S. Chamber of Commerce, highlighted this morning by badger: Exit Strategy: FATCA Tax Law Keeps Pushing Americans To Give Up Citizenship. Growth opportunity — the HIRE Act continues to give.
Here’s a hot tip for accountants and tax attorneys: now is a good time to develop specialized expertise in advising clients who may be seeking to expatriate from the United States. That demographic looks more and more like a real growth opportunity.
Some firms have already figured this out!
The US Embassy in Ottawa still has the old fee posted as of today:
“….If you are a U.S. citizen who has acquired or plans to acquire Canadian citizenship, and you intend to relinquish your U.S. citizenship or wish to relinquish your U.S. citizenship, please discuss with the U.S. Embassy or Consulate the procedures necessary to formalize this. There will be a US$450 fee to document formal renunciation of U.S. citizenship. More information relating to the loss of citizenship is on this Travel.State.Gov information sheet…… …”
http://canada.usembassy.gov/consular_services/dual-citizenship.html accessed on Sept.3, 2014
But eventually someone in the media is going to point out the inconvenient truths – like forcing 18 year olds to pay a huge fee that is on par with a semester of university tuition to dump a citizenship that they probably inherited is punitive and clearly old-school totalitarian.
Well, at the end of the day, joining the reserves to create an expatriating act is an option for some people – 18-year-olds perhaps more than the rest of us. The combat support occupations aren’t that strenuous. It’s the only relinquishment/renunciation strategy that makes you money. Besides: healthy exercise and character-building.
@kermitzii: now this I want to see. You could upload it to an image hosting service like http://twitpic.com and then link to it in a comment.
@calgary411
Thanks for the link to the globe and mail article. I put a few comments in, and added some up arrows! 🙂 Also the “New Herpes” was a good one to send to the State Department twitter account.
https://twitter.com/FATCA_Fallout/status/507210395702939648
US embassy officials in Belize slacking off or ducking tough questions, huh?
http://amandala.com.bz/news/visa-consular-fees-announced/
@justme,
thanks for posting Phil Hogden’s comments. I have to agree with him. My bet that the Prez wants to save face and would rather have people LIE about their situation than tell the truth. Sad.
A broken man on a Halifax pier, I suppose that is true but I don’t think the parents or the kids are going to agree that this is a better option. Pay an extortion fee or sign away years of their year lives to the military, hoping that nothing arises to put the price of renouncing at possibly sacrificing their lives.
Combat support might not be strenuous but those people lose their lives too and depending on the country, the odds of finding yourself in a battle zone aren’t zero. Heck, you read about soldiers dying in training exercises.
But ya know, this would make a great topic to bring up – maybe even as a post here – because for some kids, this could be their only option and risking your life to not be an American is something that should be pointed out as a consequence of this “necessary” fee hike.
From the Moodys Gartner Blog: Does the increased fee for renouncing US citizenship indicate a change in attitude toward expatriates? by Aamir Mahboob, JD, LLM (US Tax)
@calgary411
Some privilege. My kids are going to have to pay this fee when they are old enough to shed the “privilege” of a citizenship in a country they have never lived in or received any services from. What a joke.
Somehow I don’t think the USG will be calling renunciation a “privilege” though that certainly seems the intent behind the increasing cost and flaming hoops. They are malicious but not quite stupid.
Changing one’s citizen is still widely – if not universally – considered a human right. The US might risk having others question their motives but are they ready to go the distance to admitting that don’t allow renunciation unless a person can pay the going rate? They still seem skittish on that point.
@ Kermitzii,
I just saw your question from last night. Sorry I don’t know how to add an image to a comment. I’d be happy to find out. But I see that Eric replied – thanks, Eric – so that should work. (If you still have a problem posting, though, let me/us know.) BTW, that sounds like a cool picture.
Pacifica and Kermitzii,
I can try to post the picture. Do you want me to contact you off the blog to get it, Kermitzii?
I hadn’t seen any mention of these fee hikes on Jack Townsend’s blog, so decided to use a comment as a method of making him away that the cost has now gone up. Maybe that is NOT so surprising, as this is not a tax law issue, but rather a bad State Department policy…
That said, I started this at the Streamline Tidbits thread…
Jack…
This is NOT specific to the Streamline tidbits. It maybe only tangentially related, in that those who are going through the latest IRS maze from abroad have probably considered giving up their U.S. Citizenship as an option either before or after this process.
Well the cost has just been increased unilaterally by the State Department from $450 to $2350.
more here…
http://federaltaxcrimes.blogspot.com/2014/08/tidbits-on-new-streamlined-procedures.html#comment-1572252102
@Just Me,
Thanks for trying to highlight that at Jack’s blog. He is fast off the mark to tell people that if they don’t like or want to obey US tax laws they should ‘JUST’ renounce their US citizenship. Knowing of course that ‘just’ renouncing isn’t simple or easy or cheap (fee plus compliance costs). And, he conveniently and willfully ignores that the US is the only country forcing people to run an injurious and risky gauntlet in order to do so. The unconscionable hike in the fee may be a bit harder for him to defend. Or not.
@osgood, some privilege indeed. The fact is that it is your right, not a privilege, to be able to renounce.
I also ask if this phrase sums up the US government’s attitude:
“The Department is entitled to establish and revise fees associated with providing a service, but those fees must be fair AND BASED ON THE COSTS TO THE GOVERNMENT, the value of the service, the public policy served and any other relevant facts”
why the fees for people wanting visas are so low. You can’t tell me it doesn’t cost just as much to investigate their backgrounds for suitability as it does for those wishing to renounce/relinquish so why are their fees between $160 and $465? Yes, there are more people applying to get in than to get out, but the workload is the same if not greater to process these applicants.
And what makes a 422% fee increase fair? Little or no warning so those who made appointments at the embassies/consulates around the world months ago have been hit extremely UNFAIRLY. At the least the new fee should only apply to appointments being booked after 12th September, all appointments booked before that date should be processed at the current fee of $450.
@kermitzii: “The Berlin wall was erected when 1-2K people per day left Eastern Germany for the West. Renunciations are not as common as people leaving East Germany in 1961 or so, but the issues are essentially the same.”
To add to your comment on the Berlin Wall, the exit costs (“Freikauf”) were high for East German political prisoners and those who wanted to emigrate from East Germany “legally”. This is a summary from articles in “Die Welt” and “Bild” newspapers:
1) Standard price paid by W. Germany to E. Germany to allow political prisoners to emigrate: DM 40,000 (1970) and then DM 95,847 (1977 and on).
– The DM 95,847 amount was thinly veiled as a “reimbursement for educational costs” incurred by E. Germany over the years prior to emigration.
2) Number of political prisoners bought free: 33,755
3) Number of “legal” emigrants bought free: 210,000
4) Total amount paid by W. Germany: DM 3.4 billion
5) “Many of the emigrants signed over their E. German assets to the churches in E. Germany. Between 1957 and 1990 upwards of 5 billion marks flowed to the E. German churches. The emigrants then received around 25% back as reimbursement in W. Germany.” (Bild)
http://www.welt.de/kultur/history/article110977513/95-847-Mark-verlangte-die-DDR-fuer-einen-Haeftling.html
http://www.bild.de/leute/2007/hg-freikauf-haeftlinge-2572890.bild.html
East Germany was a signatory to the International Covenant on Civil and Political Rights (ICCPR) and the Helsinki Accords. In 1977 and 1984 the UN Human Rights Commission held hearings on the “right-to- emigrate” issue. East Germany defended its policies based on ICCPR Article 12 which allows restrictions on freedom of movement to “protect national security, public order or health, and the rights and freedoms of others” (Wiki).
http://de.wikipedia.org/wiki/Flucht_aus_der_Sowjetischen_Besatzungszone_und_der_DDR
http://en.wikipedia.org/wiki/International_Covenant_on_Civil_and_Political_Rights
Broken man—unfortunately, joining the reserves in a country of which you are already a citizen will not work as a relinquishment–the oath of allegiance is not considered “meaningful” if you are already a citizen of the country to which you swear the allegiance.
@QM, It will if you are serving as a commissioned or non-commissioned officer.
That would also be applicable if you were a cadre member of the Cadet Forces in some countries as you have a full commission.
Also easy if you have a professional degree like a nurse or medical doctor.
@George, where would a degree come into it? There’s nothing about that in the US list of ways to relinquish.
@Medea –
I think he meant that it’s an easy route to a commission.
if you have children of an age to qualify for civil or military positions they should apply
Canada had at one time university ROTP (Reserve Officer Training Program, similar to US ROTC)
upon taking an oath for non-com or commissioned equivalent rank, duals could relinquish.
@mediafleecestar, If you have a professional degree such as medical doctor, nursing, legal, pharmacy and some others, in many countries you can join the reserve forces and instantly become a commissioned officer.
Otherwise……you start out as a low ranking enlisted soldier which is not an expatriating condition.
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@George, thanks for the explanation. Didn’t know that.