There’s an old saying, America: Love it or leave it. Ironically, this was often used as a response by those ideologically right for those ideologically left in the late sixties and early seventies. The idea behind the phrase is simple, really. America has its problems, but if one doesn’t think the positives outweigh the negatives, then feel free to expatriate to Canada, Mexico, or all points not here. What makes this ironic is that after a record year of expatriations, many on the right are saying that it is U.S. tax policy that is behind it.
According to RT.com, “The US Treasury Department is required to publish a list of Americans who renounced their citizenship each quarter,” and the latest numbers indicate that 2,999 people renounced their citizenship or their green cards in 2013. No reason is recorded for why these Americans and legal immigrants would do this, but that hasn’t stopped those on the right from suggesting that it is current tax policy that is behind it all.
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An article in Forbes points to the example of Facebook co-founder Eduardo Saverin—which promoted legislation from Democratic Sens. Chuck Schumer of New York and Bob Casey of Pennsylvania to raise the exit tax to 30% for those leaving for tax purposes—as evidence that America is going to start hemorrhaging rich citizens because of our tax laws. Specifically, the author references FATCA, a controversial law that seeks to limit the kind of off-shore tax havens that the rich have exploited for years to avoid paying their full share of taxes.
Still it’s all speculation, there is no proof that the increase of expats is related solely to taxes, but it is a figure that the anti-tax crowd can jump on as evidence of how unbearable America has become for its wealthy. If this is the case, though, it’s remarkably short-sighted on behalf of those who’ve renounced their citizenship. There’s no coming back once the tax laws change again.