Why London Mayor Boris Johnson is a poster boy for 8 million U.S. expats: http://t.co/7oZlcURnhz
— Laura Saunders (@Saunderswsj) December 4, 2014
This article is behind a paywall – perhaps somebody can provide a direct link. It apparently will be in the print edition tomorrow so it would be good to get comments up today. The text of the article is here.
The article includes:
Now he has a new claim to fame: as a poster boy for millions of U.S. “tax cheats” living abroad.
Recently, the 50-year-old Mr. Johnson, who holds dual U.S./U.K. citizenship, complained that the U.S. is “trying to hit” him for taxes on the sale of his London home, even though he hasn’t lived in the States since he was five.
In an interview with NPR about Churchill, Mr. Johnson called his U.S. tax bill “absolutely outrageous,” after a listener asked about his citizenship status. When pressed as to whether he would pay, Mr. Johnson said, “No is the answer…why should I?…I pay my taxes to the full in the United Kingdom, where I live and work.” These taxes are often at higher rates than in the U.S., he added.
Mr. Johnson’s spokesman says he has no further comment on the matter. The Telegraph, a British newspaper, has reported that he and his wife bought a London house for GBP470,000 (about $750,000) in 1999 and sold it for GBP1.2 million (about $1.9 million) in 2009. The Internal Revenue Service is prohibited by law from commenting on issues involving individual taxpayers.
Mr. Johnson’s case is a perfect illustration of the dilemmas faced by many of the 7.6 million U.S. citizens living abroad as a result of U.S. authorities’ five-year campaign against secret offshore accounts. It began after disclosures that Americans were being encouraged to hide money in Switzerland.
Most of these expats have never had a numbered Swiss account, but many of them, like Mr. Johnson, are finding they haven’t complied with U.S. tax laws that seem to them highly unfair. “It’s a clear example of the harm befalling citizens caught in the maw of multiple tax systems–a status imposed on every American citizen abroad,” says Jackie Bugnion, a director of American Citizens Abroad, an expat group.
The root cause, experts say, is that both the U.S.’s definition of citizenship and its tax system are broad.
Read more: http://www.nasdaq.com/article/london-mayor-is-poster-boy-for-expat-tax-woes-20141204-00782#ixzz3KxFIzjmS