Orrin Hatch, as you may remember, was one of the first Republicans to speak out in favour of the Ex-PATRIOT Act in 2012; Bloomberg News quoted him as stating, “it always bothers me when somebody renounces his citizenship in the greatest country on Earth just to save money, save taxes” (or save themselves from emigrant-only $13,000 fines on $21-per-year tax deficiencies). Now, not willing to be outdone by the Ex-PATRIOT Act sponsors who are once again proposing permanent exile for people who dare exercise their human right to move to another country and live there until they qualify for naturalisation, Hatch made the following comment in a speech on the Senate floor. At page S4389 of the Congressional Record for 12 June 2013:
When a citizen decides to leave the United States and renounce their citizenship, they often face taxes on income earned in the United States and on any gains from appreciated assets. Is it punitive to apply a similar standard for those seeking U.S. citizenship? Think about that: When a U.S. citizen decides to leave the United States and renounce their citizenship, they often face taxes on income earned in the United States and on any gains from appreciated assets. That is not punitive. The answer, of course, is that it is not punitive.
The context of Hatch’s comments was a speech claiming that his amendments relating to taxation and healthcare coverage for registered provisional immigrants were also “not punitive”. Hatch’s facile description of the exit tax is not accurate, making one wonder whether anything else he says to justify his policy proposals is: under the half-decade-old HEART Act, the tax on ex-citizens is applied not just on “income earned in the United States”, but current unrealised non-U.S. capital gains, including capital gains on a house whose purchase was funded in the first place by non-U.S. wages used to qualify for a mortgage from a non-U.S. bank protected by a non-U.S. mortgage guarantee scheme, all under the laws of a non-U.S. government. I suppose he thinks that punishing people who renounce citizenship to save their mortgages is entirely appropriate anyway. Apparently Hatch hates anyone who dares to leave his birth country and pursue a better life elsewhere, whether they move to the United States or away from it.
