72 thoughts on “Toronto May 2 Citizenship Based Taxation Forum live comments”
I am here at St. Michaels College and hopefully be able to provide some live comments. ACA says no discussion of renunciation of citizenship will take place today. I wonder whether I am allowed in the room.
Kirsch : Benefit of citizenship is the right to return. But taxes not necessarily tied to benefits. CBT based on ability to pay income tax approach. Citizenship is a voluntary self identification as a member of US society.
@Petros re: “Citizenship is a voluntary self identification as a member of US society. ” Well, I don’t volunteer, and am definitely not a part of US society, so does this mean I am not a US citizen? I wish!
ACA is not allowing any video event except their own. Pretty tight control of media. They have hired a video crew.
Murray Rankin is here.
Kirsch has brought up relinquishment of US citizenship against the rules. Nothing wrong with giving up citizenship, if one feels no longer tied to US. The hassle of getting rid of citizenship is a true problem that should be fixed.
Kirsch says implementation has created problems for citizens abroad, interfering with their lives. Some are evading taxes to be sure. But it is not fair to treat everyone as tax evaders.
Kirsch: Current system if too onerous cannot work. It should be less onerous than it is today with too heavy penalties.
Kirsch: Reed amendment not justified. Voluntariness of citizenship must be respected. Name and shame list is wrong. It does not respect the voluntary aspect of US citizenship.
@Petros, If you are allowed to ask questions, tell Kirsch that right of return is the benefit of nationality, not citizenship, and the US does not tax US nationals without citizenship on worldwide income, or citizens residing in US territories on local income. Citizens of the Marshall Islands, Micronesia and Palau can also freely move to the US and are not taxed on worldwide income by the US.
Kirsch is consistent. He claims that citizenship is voluntary, so in his paper he criticizes “punishments” such as the Reed amendment and the lists in the Federal Register. He also proposes simplification of the reporting requirements, relief from penalties, and elimination of the reimbursement of evacuation costs.
Kirsch: Residency based taxation problematic because the taxpayer would use the rules to their benefit, or even cheat, because iRs has no way of knowing how long a person stays in US.
@Petros: “Kirsch: Residency based taxation problematic because the taxpayer would use the rules to their benefit, or even cheat…“. Puzzled. More than 190 other countries on the face of the planet somehow manage to make RBT work. Why is the US incapable of doing the same?
Sorry, Petros, I just noticed I repeated exactly what you had written.
“IRS has no way of knowing how long a person stays in US.” This argument is not valid. The IRS has no way of knowing if people are citizens, residents or nonresident aliens in the first place. It also has no way of knowing the income of self-employed people and capital gains of real estate. The system is based on self-reporting and voluntary compliance.
@Petros,
Thanks for doing this for those of us who cannot be there.
Thank you too, Petros.
No time for questions yet.
Schneider: US causes problematically persons born in US and born to Parents who are citizens to be citizens. Quite generous provisions encompasses many people.
Perception of expatriates is as shirkers, a theme that spans from Civil War to present. Benedict Arnolds and tax dodgers. Members of Congress, Treasury, and the press feel this way. This is unfair.
Correction: The IRS can know the capital gains of most real estate because selling prices are usually public. But my objection remains: why is the concern that people may cheat under RBT, claiming to be nonresidents, greater than the concern that people may cheat under CBT, claiming to be nonresident aliens?
schneider. Problematic citizens to tax are accidental citizens, or citizens by descent, and those who do not know they are citizens. Citizens who thought they lost their citizenship pre-Aforyim. Permanent residents who leave and quickly lose their right to return to the US
Schneider. What is the cost? The citiZenship penalty, on income, destroys retirement planning, foreign exchange penalizes phantom gains. Compliance costs, intrusive reporting obligations, limitations on banking and investment.
I’m starting to feel that Schneider doesn’t object to the principle of “benefits of citizenship”. He seems to be more concerned with accidental citizens and practical problems, for which Kirsch has answers. Profs. Reuven Avi-Yonah and Edward Zelinsky do object to the principle. I’d prefer a more fundamental debate.
Schneider: bases of taxes
residence and source for residence based taxation
for CBT Are you a member of the polity, do you benefit from citizenship?
membership of polity is insufficient. We do not live in world where citizenship has sufficient meaning on which to hang CBT. We are not living the situation of 100 years ago, we live in a world of instant communication. Horizontal equity and ability to pay should not affect a person who lives outside a jurisdiction.
Benefits of citizenship: passport, ability to move of US. protection is very limited, particularly of citizens of other countries don’t need protection.
consular services are paid for in any case.
right to vote: representation does not require taxation.
CBT widely seen as unjust and imperialistic.
Restricts labour mobility, increases complexity, difficult to enforce, limited revenue benefit
Never mind, my suspicion was wrong. Great to see that Schneider is mentioning all the arguments.
Schneider. Benefits of RBT
tax justice. tax costs should reflect benefits
end of US exceptionalism and imperialism
Revaluation of US citizenship
FEIE is conception no good, it is a patch which has permitted CBT to continue
I am here at St. Michaels College and hopefully be able to provide some live comments. ACA says no discussion of renunciation of citizenship will take place today. I wonder whether I am allowed in the room.
Kirsch : Benefit of citizenship is the right to return. But taxes not necessarily tied to benefits. CBT based on ability to pay income tax approach. Citizenship is a voluntary self identification as a member of US society.
@Petros re: “Citizenship is a voluntary self identification as a member of US society. ” Well, I don’t volunteer, and am definitely not a part of US society, so does this mean I am not a US citizen? I wish!
ACA is not allowing any video event except their own. Pretty tight control of media. They have hired a video crew.
Murray Rankin is here.
Kirsch has brought up relinquishment of US citizenship against the rules. Nothing wrong with giving up citizenship, if one feels no longer tied to US. The hassle of getting rid of citizenship is a true problem that should be fixed.
Kirsch says implementation has created problems for citizens abroad, interfering with their lives. Some are evading taxes to be sure. But it is not fair to treat everyone as tax evaders.
Kirsch: Current system if too onerous cannot work. It should be less onerous than it is today with too heavy penalties.
Kirsch: Reed amendment not justified. Voluntariness of citizenship must be respected. Name and shame list is wrong. It does not respect the voluntary aspect of US citizenship.
@Petros, If you are allowed to ask questions, tell Kirsch that right of return is the benefit of nationality, not citizenship, and the US does not tax US nationals without citizenship on worldwide income, or citizens residing in US territories on local income. Citizens of the Marshall Islands, Micronesia and Palau can also freely move to the US and are not taxed on worldwide income by the US.
Kirsch is consistent. He claims that citizenship is voluntary, so in his paper he criticizes “punishments” such as the Reed amendment and the lists in the Federal Register. He also proposes simplification of the reporting requirements, relief from penalties, and elimination of the reimbursement of evacuation costs.
Kirsch: Residency based taxation problematic because the taxpayer would use the rules to their benefit, or even cheat, because iRs has no way of knowing how long a person stays in US.
@Petros: “Kirsch: Residency based taxation problematic because the taxpayer would use the rules to their benefit, or even cheat…“. Puzzled. More than 190 other countries on the face of the planet somehow manage to make RBT work. Why is the US incapable of doing the same?
Sorry, Petros, I just noticed I repeated exactly what you had written.
“IRS has no way of knowing how long a person stays in US.” This argument is not valid. The IRS has no way of knowing if people are citizens, residents or nonresident aliens in the first place. It also has no way of knowing the income of self-employed people and capital gains of real estate. The system is based on self-reporting and voluntary compliance.
@Petros,
Thanks for doing this for those of us who cannot be there.
Thank you too, Petros.
No time for questions yet.
Schneider: US causes problematically persons born in US and born to Parents who are citizens to be citizens. Quite generous provisions encompasses many people.
Perception of expatriates is as shirkers, a theme that spans from Civil War to present. Benedict Arnolds and tax dodgers. Members of Congress, Treasury, and the press feel this way. This is unfair.
Correction: The IRS can know the capital gains of most real estate because selling prices are usually public. But my objection remains: why is the concern that people may cheat under RBT, claiming to be nonresidents, greater than the concern that people may cheat under CBT, claiming to be nonresident aliens?
schneider. Problematic citizens to tax are accidental citizens, or citizens by descent, and those who do not know they are citizens. Citizens who thought they lost their citizenship pre-Aforyim. Permanent residents who leave and quickly lose their right to return to the US
Schneider. What is the cost? The citiZenship penalty, on income, destroys retirement planning, foreign exchange penalizes phantom gains. Compliance costs, intrusive reporting obligations, limitations on banking and investment.
I’m starting to feel that Schneider doesn’t object to the principle of “benefits of citizenship”. He seems to be more concerned with accidental citizens and practical problems, for which Kirsch has answers. Profs. Reuven Avi-Yonah and Edward Zelinsky do object to the principle. I’d prefer a more fundamental debate.
Schneider: bases of taxes
residence and source for residence based taxation
for CBT Are you a member of the polity, do you benefit from citizenship?
membership of polity is insufficient. We do not live in world where citizenship has sufficient meaning on which to hang CBT. We are not living the situation of 100 years ago, we live in a world of instant communication. Horizontal equity and ability to pay should not affect a person who lives outside a jurisdiction.
Benefits of citizenship: passport, ability to move of US. protection is very limited, particularly of citizens of other countries don’t need protection.
consular services are paid for in any case.
right to vote: representation does not require taxation.
CBT widely seen as unjust and imperialistic.
Restricts labour mobility, increases complexity, difficult to enforce, limited revenue benefit
Never mind, my suspicion was wrong. Great to see that Schneider is mentioning all the arguments.
Schneider. Benefits of RBT
tax justice. tax costs should reflect benefits
end of US exceptionalism and imperialism
Revaluation of US citizenship
FEIE is conception no good, it is a patch which has permitted CBT to continue