The facts in Afroyim
The facts as described in the court’s decision in Afroyim were:
Petitioner, of Polish birth, became a naturalized American citizen in 1926. He went to Israel in 1950, and in 1951 voted in an Israeli legislative election. The State Department subsequently refused to renew his passport, maintaining that petitioner had lost his citizenship by virtue of § 401(e) of the Nationality Act of 1940 which provides that a United States citizen shall “lose” his citizenship if he votes in a foreign political election. Petitioner then brought this declaratory judgment action alleging the unconstitutionality of § 401(e). On the basis of Perez v. Brownell, 356 U. S. 44, the District Court and Court of Appeals held that Congress, under its implied power to regulate foreign affairs, can strip an American citizen of his citizenship.
The legal basis for arguing that the statute stripping Mr. Afroyim of his US citizenship was unconstitutional was the 14th Amendment which includes:
Section 1. All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.
In other words, the fact of “birth” or “naturalization” in the United States affords a constitutional right to US citizenship which cannot normally be taken by the government. Therefore, the government cannot enact a law that would “strip” a person of US citizenship at the whim of the government.
What the court ruled in Afroyim
Held: Congress has no power under the Constitution to divest a person of his United States citizenship absent his voluntary renunciation thereof. Perez v. Brownell, supra, overruled. Pp. 387 U. S. 256-268.
(a) Congress has no express power under the Constitution to strip a person of citizenship, and no such power can be sustained as an implied attribute of sovereignty, as was recognized by Congress before the passage of the Fourteenth Amendment, and a mature and well considered dictum in Osborn v. Bank of the United States, 9 Wheat. 738, 22 U. S. 827, is to the same effect. Pp. 387 U. S. 257-261.
(b) The Fourteenth Amendment’s provision that “All persons born or naturalized in the United States . . . are citizens of the United States . . .” completely controls the status of citizenship, and prevents the cancellation of petitioner’s citizenship. Pp. 387 U. S. 262-268.
The Good News – the preservation of citizenship:
Afroyim was an important ruling which created the possibility for US citizens to acquire an additional citizenship without relinquishing US citizenship. Hmmm … Is that good? Remember that US citizenship is the world’s ONLY true “taxation-based citizenship!)
The Bad News – the expansion of taxation:
Afroyim had the effect of increasing the number of citizens of other countries who were treated as US tax residents. In other words, Afroyim had a number of effects which include (but are not limited to):
1. Expanding US taxation-based citizenship into other countries in general and through FATCA in particualar
2. Making it very difficult for US citizens to move from the United States and fully integrate into other countries
3. Making it difficult for “accidental Americans” to even maintain a basic bank account
4. Confiscate some of the non-US pensions of Americans abroad who wish to renounce US citizenship
The irony is that a Supreme Court decision in Afroyim that was intended to protect US citizenship has had the additional effect of making US citizenship a disability for Americans abroad and contributing to the “forcible destruction of their citizenship!
Yes, taxation was not considered, referenced and even thought of during the whole Afroyim process.
The lesson is clear and that lesson is:
No consideration of US citizenship is possible without the recognition that US citizenship is in fact primarily about taxation.
As the Eagles wrote in the Hotel California:
You can check out any time you like
But you can never leave”
What About Taxation and the “forcible destruction of citizenship”
Mr. Justice Black’s ruling in Afroyim concluded with:
Citizenship in this Nation is a part of a cooperative affair. Its citizenry is the country, and the country is its citizenry. The very nature of our free government makes it completely incongruous to have a rule of law under which a group of citizens temporarily in office can deprive another group of citizens of their citizenship. We hold that the Fourteenth Amendment was designed to, and does, protect every citizen of this Nation against a congressional forcible destruction of his citizenship, whatever his creed, color, or race. Our holding does no more than to give to this citizen that which is his own, a constitutional right to remain a citizen in a free country unless he voluntarily relinquishes that citizenship.
Does the punitive taxation of US citizens abroad result in the “forcible destruction of citizenship”?
Appendix – The Evolution Of Citizenship, Taxation and Citizenship Taxation And The Creation Of The Fiscal Prison
Part 1 – The Evolution Of Taxation
Part 1: Cook v. Tait 1924 – The evolution of Citizenship, Taxation and “Citizenship Taxation”
http://citizenshipsolutions.ca/2015/05/12/part-1-cook-v-tait-1924-the-evolution-of-citizenship-taxation-and-citizenship-taxation/embed/#?secret=PM7FrkB9Gz#?secret=0fLcmj9cka
Part 2 – The Evolution Of Citizenship
Part 2: Cook v. Tait 1924 – The evolution of Citizenship, Taxation and “Citizenship Taxation”
We are all well aware that 99 percent of those lining up to renounced at embassies all over the world are doing so because of US tax code and associated laws. Of course there will be fools claiming that they are there by choice, but those fools never tried leading a normal, full, secure, law abiding life as a US citizen abroad.
It isn’t possible.
Of course no one would renounce if they could just live in peace. Think about it: every other country’s people can move elsewhere, get a job or start a business, and just get on with their life. They pay their taxes to the country hosting them. Then, later on they’re free to return “home” and resume their lives there. Not US citizens, though. No siree! You are chattel, a slave.
The knife-twist AFTER the extortionate fleecing of $2350USD is the part where you must swear, “I am exercising my right of renunciation/relinquishment freely and voluntarily without force, compulsion or undue influence placed upon me by any person” when they KNOW damn well it is US gov’t itself forcing everyone away! It’s so sick and twisted. I’m relieved to be out.
I received my CLN yesterday. I have not been this happy since before I heard of FATCA. Although I have been reading this site every day for over ten years I have been too discouraged to post anything here until now. Now I can’t stop smiling.
“Do the Specific Rules Of US Citizenship Taxation Result In The Forcible Destruction Of US citizenship?”
Short answer = YES!
If not for the unjust, deliberately punitive, incomprehensible and draconian provisions and layered penalty structures of the US CBT/FBAR/FATCA regime designed to punish those living outside the US, I would still have my birthright US citizenship.
I would still also have all the hard earned money spent on specialized US tax preparation and legal assistance once I became aware of the depths of the morass a simple accident of birth had mired me in. This even though my income was low or nearly non-existent, NO US tax was ever owed, and all my bank accounts were local, legal and properly registered with the CRA via my Canadian SIN # for taxation purposes, and all interest reported and taxed by Canada when applicable!).
If not for the twinning of US citizenship with the insane provisions of US extraterritorial CBT, my wholly Canadian family and I would not have endured 3-5 horrible years of US source stress and dread trying to make my way out of the dark morass that previously unbeknownst to me came inextricably tied to my US birthplace despite having lived in Canada for most of my over half century of life – having left the US as a toddler.
Excising the malignancy that US citizenship had become when inextricably tied with US extraterritorial taxation/FBAR/FATCA as applied to those of us ‘abroad’ was my only real and lasting recourse for regaining peace of mind and ensuring the wellbeing of my family.
Having to make difficult choices does not meet the legal standard of “force, compulsion or undue influence.” An (unlikely) example of that would be, someone threatening to kill you unless you renounce. So please don’t say you are being coerced at your renunciation hearing. If you do, the officer may grow alarmed and start making phone calls to security.
@ Zla’od,
The oath of renunciation refers to “free of any duress or undue influence” for situations such as a family member influencing the person against their will; and compulsion, coercion or a threat to dissuade the person from renouncing does not have to be violent – more probably it would be a threat that the family would shun or disown the person if they don’t renounce. Likely to happen? It’s probably super-extremely rare. But they do seem to keep an eye out for duress and undue influence — I know a case where a person who, due to fraility, had to be accompanied to the consulate meeting by a family member, was questioned privately and asked if there was any pressure from family to do this.
@Zla’od,
I disagree, if my friends want financial security, equal opportunities and to save efficiently for retirement they are forced to renounce. You can call it a “difficult decision” if you like.
“Coercion -the practice of persuading someone to do something by using force or threats.”
The constant threat of a life altering penalty for making a mistake with a form, the constant threat of a change in the law that ruins you.
@ Mike,
Good point. Quite a few people have expressed that they undertook renunciation only very reluctantly, having concluded that it was, for them, necessary, in order to live a normal life in their home country.
DoS mentions difficult choices and duress, in the Foreign Affairs Manual, 7 FAM 1221 (b), with a note added in, IIRC, 2015: (although probably more in the context of DoS initiating a loss-of-citizenship decision for a potentially relinquishing act, since a person is unlikely to show up for a renunciation and claim it’s invalid due to the pressure at the same time):
I sure don’t agree that being unable to bank is not duress; rather I see it as an insurmountable problem to making a living or simply living in society. Good luck living a normal life without a bank account — and it doesn’t even mention the difficulties/impossibilities of dealing with the conflicts of two tax systems, inability to save effectively for retirement due to it, etc.
CBT and FATCA have basically forced some people to renounce their US citizenship, as is evident from comments people have made here and elsewhere, expressing their extreme reluctance and sadness at so doing but feeling their hand was forced (ironically by US government policy which prevented them from living a normal life). In these cases, the US itself has destroyed their citizenship. Which would not have been the case, had they been a citizen of any other country.
Some of us made an $850 (US) profit on renunciation. The fee is still $2350, but you could pull in the $3200 stimulus benefit without filing tax returns if you had an SSN and submitted the “non-filer” form in 2020. No need to pay accountants or lawyers so much as a dime. Not the worst deal, as it turned out.
@ Travis
Congratulations! Keep on smiling. I still remember the smile of relief on my husband’s face when I brought his CLN home from the post office, back in 2014. Then Canada Day of that year the Canadian government enacted FATCA and what should have been a day of celebration for us was not so much.
@ badger and pacifica777
Yes, I’m still around but I only drop by Brock occasionally now. I’m still grateful for the support and information we got from this intrepid website.
@Embee
Thanks, I am still smiling. I have enjoyed reading your posts for many years. Of course, you are one of many Brockers that provided hope for me during times when it felt as though there was no hope. Brock helped keep my sanity during the years of dealing with this insanity.
@EmBee,
Glad you’re still dropping by the site. Very nice to read your comment, and thanks for the considerable support and information that you’ve contributed to Brock and Brockers.
@Travis,
Congrats from me too! Nice to see you commenting on-line (I know you’ve been reading the site regularly a very long time) – and thanks for all your off-line participation (there’s been lots) in Brock projects over the years.
Glad to see your moniker @embee!
Still remember with gratitude and admiration your creative ditties – they made me laugh even when I felt things were too dark to find the funny in.
This site, and those who created and supported it then and now were a godsend.
Take care!