Two pieces this week have reinforced the trend identified by Spear’s for Americans to expatriate – give up their citizenship
Two pieces this week have reinforced the trend identified by Spear's for Americans to expatriate – give up their citizenship.
'While the numbers of those renouncing their U.S. citizenship are small—more than 1,000 people in the second quarter of 2013, out of more than six million Americans estimated to be living abroad—the numbers have climbed this year, according to recently released figures.
'The main trigger for cutting ties with U.S., several lawyers say, is the Foreign Account Tax Compliance Act, or Fatca, which requires foreign institutions to disclose the overseas assets of U.S. green-card holders and citizens to the U.S. government. The main objective of Fatca is to identify people who may be evading taxes through offshore investment vehicles…
'Some U.S. citizens say they are exasperated by a growing raft of paperwork that forces U.S. citizens living abroad to declare the minutiae of their financial holdings and other assets. That has increased the attraction of becoming a citizen in places such as Hong Kong, where the individual tax rate is capped at 15%.
'”My decision was less about the actual amount of taxes I had to pay, and more about the system,” said one investment banker, who renounced his U.S. citizenship and is now a Hong Kong citizen. “I'm not an ultrawealthy dude. It was the hassle with all the paperwork.”'
And a blogger for the Economist wrote about his American wife:
'Anyway, as part of the regulations, she is required to declare the balance on her Oyster card, the electronic ticket that allows Londoners rapid access to our buses and tubes. What on earth can be the purpose of this ludicrous regulation? Does the IRS imagine that expat Americans are loading up their Oyster cards with thousands of dollars of credits as a form of money laundering?
'Is a modern version of Charles Ponzi (who you will recall claimed to invest in international postal coupons) smuggling in Oyster cards to the US as part of a massive investment fraud? Surely not; this is mindless bureaucracy, pure and simple.'