Senators to Unveil the Ex-Patriot Act to Respond to Facebook’s Saverin

http://abcnews.go.com/blogs/politics/2012/05/senators-to-unveil-the-ex-patriot-act-to-respond-to-facebooks-saverins-tax-scheme/

by kyleslattery • 14 years ago

14 30 14 years ago

abcnews.go.com

gee_totes2• 14 years ago

What happens under this law if you are already living in the US and renounce your citizenship for tax reasons and have no other country of which you are a resident? Do you get deported to NULL?

spligak• 14 years ago

You cannot renounce your citizenship while in the country. The process requires you leave the US, enter an embassy or consulate and declare your intention to renounce. File some paperwork and you're no longer a citizen.

The catch is you'll probably want to do this in a friendly country or one you're already a citizen of.

Jabbles• 14 years ago

You can't renounce your citizenship whilst in the US. You have to do it at an embassy.

On statelessness: Persons intending to renounce U.S. citizenship should be aware that, unless they already possess a foreign nationality, they may be rendered stateless and, thus, lack the protection of any government. They may also have difficulty traveling as they may not be entitled to a passport from any country. Even if they were not stateless, they would still be required to obtain a visa to travel to the United States, or show that they are eligible for admission pursuant to the terms of the Visa Waiver Pilot Program (VWPP). If found ineligible for a visa or the VWPP to come to the U.S., a renunciant, under certain circumstances, could be barred from entering the United States. Nonetheless, renunciation of U.S. citizenship may not prevent a foreign country from deporting that individual back to the United States in some non-citizen status.

http://travel.state.gov/law/citizenship/citizenship_776.html

forgottenpaswrd2• 14 years ago

They are dozens of countries that will give you citizenship if you pay, like the US does(If you have money you become citizen).

gee_totes2• 14 years ago

Is there a list of these countries somewhere? The only country that I know of that sells citizenship was Sealand (they don't anymore, but they were offering passports as a fundraiser).

http://principality-of-sealand.eu/faq_e.html

Actually, the above website may not be from the REAL Sealand... long story.

WiseWeasel2• 14 years ago

I could see imposing US capital gains taxes, but barring travel to the US seems vindictive.

cleverjake2• 14 years ago

I believe that is the point, honestly.

WiseWeasel2• 14 years ago

Countries should never appear vindictive, as it also makes them look petty and weak.

[edit] Also, how does it make sense to impose taxes AND bar them from entry? Seems like more of an either/or type of situation. If someone is paying US taxes, then obviously they should be allowed entry; no one wants to fund the mechanism that punishes them. [/edit]

cschep• 14 years ago

I wonder what would happen if it wasn't such a waste of money to give it to the government. Would people be more inclined to stick around and do so? I don't blame him one bit, seems like most of his money would end up bailing out a bank or something equally disagreeable.

jbooth4• 14 years ago

The first rule of tautology club is the first rule of tautology club.

If you start from an unproven assertion ('all government spending is waste'), you can believe whatever you want. Things like, "Hey, I'm not being an out-for-myself bastard who's reneging on his obligations to society by being a tax cheat, I'm John Galt! I'm a good guy!".

Without the US ecosystem, it's hard to see facebook being as successful as it has been. It's pretty weak to turn around after that and say you're not obligated to pay US taxes.

sp3322• 14 years ago

Well of course he has been paying US taxes, while he lived here. When he stops living here, the USA shouldn't have any claim to tax him anymore, that's just common sense. He's going to pay taxes on the stocks he owns when he leaves as if he had just sold them; that's about half a billion dollars in taxes. Congress thinks that's not enough, apparently.

DodgyEggplant2• 14 years ago

First rule of false argument is to push a sound argument to an extreme and ridicule it. The argument is not "all government spending is waste" but rather "significant part of government spending is the product of narrow, sectorial and personal interests which are not that different from Saverin's". That's unfortunately a sound argument. You could easily find sum equal to his tax savings wasted without a remote linkage to anything patriotic.

gyardley3• 14 years ago

He presumably paid capital gains taxes on his Facebook stock when he left the country.

You might find his disloyalty to America distasteful, as I do - if his citizenship was so easily discarded, perhaps he shouldn't have acquired it in the first place. You might believe long-term capital gains tax rates are too low. But if you're implying this man is a tax cheat who's reneging on his obligations to society, that's just slander. As far as I can tell he followed the law, paid his taxes, and kept his obligations.

ckluis• 14 years ago

Anyone notice the tone of the comments? Financial berlin wall being the most frequent.

Sheer lunancy. Saverin is a world citizen who lived in the US for a time while it was prudent and now longer does. The policies that cause this should be looked at rather than creating more broken policies.

jws• 14 years ago

Will this also include corporations that use foreign incorporation to reduce US taxes?

And I can't connect …owns an estimated 4 percent of Facebook and stands to make $4 billion… with …help him duck up to $67 million in taxes.

He is allegedly avoiding a 1.7% tax on his projected $4000 million? It sounds a bit of a stretch to say he'd renounce citizenship just to save what amounts to trading noise. (e.g. AAPL and GOOG each moved more than that in the last 3 hours, in opposite directions.)

sp3322• 14 years ago

From what I've heard, the "exit tax" is equivalent to paying capital gains tax (fairly low 15%) on all stocks you currently hold. His will come to $0.5B in taxes! So leaving the country might avoid some other taxes that come to $170M. Anyway he's currently living in Singapore, so maybe switching citizenship wasn't as big a deal.

mikeash2• 14 years ago

I really wish politicians were willing to sit back and do nothing for one-off non-problems. I can't say I approve of Saverin's maneuvering, and dodging taxes by renouncing citizenship is in poor taste, but do we really need a law just for this one guy?

cluda01• 14 years ago

There was approximately 1800 people who relinquished citizenship this year. If each of these people has a net worth over $1m this could very quickly add up to a significant amount of lost tax revenue.

mikeash2• 14 years ago

And if each of those people has a perpetual motion machine, the world's energy problems would be solved forever.

Do you have any sort of basis in your "net worth over $1m" idea, or is that just pure speculation? Because in the absence of actual numbers, I can't see why you'd even make that statement.

gyardley3• 14 years ago

Let's assume they have an average net worth of not $1M but $10M each, and that the US government is able to confiscate 100% of it, leaving them utterly penniless but netting $18B.

The federal deficit for 2012 was ~$1.3 trillion, so that $18B is about 1.5% of the shortfall.

I'm not saying $18B isn't significant - but focusing on 'the rich' or 'expatriates' or any other high-net-worth group just isn't going to solve America's problems.

forgottenpaswrd2• 14 years ago

Wow, it is incredible how the US is becoming more and more of a police state day after day. The currency devaluation by the Fed, the TSA, the patriot act, the bail outs, and now trying to prevent by force of the law citizens escaping the country.

thrill• 14 years ago

We should be creating a tax structure that makes people clamoring to bring their wealth into the country - not maneuvering to leave.

Senators to Unveil the Ex-Patriot Act to Respond to Facebook’s Saverin

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