-Submitted by Simon Black via Sovereign Man blog -
(snip)"A massive 1,131 individuals renounced their US citizenship last quarter, according to data that has yet to be officially released (though I was able to procure an advanced copy).
This is a HUGE jump.
Compared to the same quarter last year in which 188 people renounced their US citizenship, this year’s number is over SIX TIMES higher.
Not to mention, it's 66.5% higher than last quarter's 679 renunciations.
This brings the total number of renunciations so far this year to 1,810.
While still embryonic, it's difficult to ignore this trend– more and more people are starting to renounce their US citizenship.
After all, the number of people who renounced citizenship this past quarter is roughly the same as the number of people who renounced for the previous four quarters COMBINED.
This movement shouldn't be that surprising for a species that began as nomadic hunter gatherers, or for a society that was founded by foreigner settlers in search of a better life.
Yet, in a rather anomalous twist, the emotional ties we have for our passports are incredibly strong.
It doesn’t matter where you’re from - the United States, Sweden, New Zealand, or Venezuela... many people all over the world are inculcated from birth with a sense that their country is ‘better’ than all the others.
We grow up with the songs, the flag waving, and the parades until the concept of motherland becomes deeply rooted in our emotional cores.
Not to mention, when so many of our friends and neighbors unquestionably fall in line, it’s a powerful social reinforcement that only strengthens the bond.
We come to view our nationalities rather ironically as a big piece of our core individuality. I am an American. I am a Canadian. I am an Austrian. Instead of - I am a human being.
It has taken decades... centuries even... to reach this point. So the fact that more and more people are making the gut-wrenching decision to ditch their US passports is truly a powerful trend.
So what’s driving it? Taxes... and the search for liberty.
For many, their tax bills constitute a financial breaking point. Particularly for people who spend most of their time outside of the United States and are constantly hamstrung by worldwide taxation and information disclosures, the burden for many of them has just become too much to bear.
The US government figured this out some years ago and began charging an exit tax to certain high income / high net worth expatriates seeking to renounce.
This applies to anyone whose average US tax liability over the last five years was about $150,000 (the equivalent of roughly $500,000 in taxable income in 2012 dollars), and/or has a net worth of at least $2 million on the date of expatriation. Curiously this net worth figure does not adjust with inflation.
The ironic thing is that in the "Act of July 27, 1868", the United States Congress declared that "the right of expatriation is a natural and inherent right of all people, indispensable to the enjoyment of the rights of life, liberty, and the pursuit of happiness."
Yet I would expect that as the number of expatriates continue to grow, this exit tax will become more and more onerous as the government tries to trap people, and their wealth, in the country.[/b]
I'm not sure what to 'make' of this development. 1130 US citizens permanently removing themselves ( and their money ) from the USA over the course of the last three months doesn't sound like a whole lot in the grand scheme of things. And certainly, there are very few dancers or camgirls who A. have consistently earned $ 1/2 million per year, and/or B. have built a nest egg worth $ 2 million, who would be directly affected by this trend.
However, it is highly probable that the 1130 US citizens who did renounce their citizenship and leave the country over the course of the past three months DID have incomes exceeding $ 1/2 million a year and assets worth $2 million. These are the type of guys who can afford to drop thousands of dollars in upscale strip clubs without batting an eye. These are also the types of guys who had each paid $150,000+ per year in income taxes ... an amount arguably equal to the total amount of income taxes paid by 100 Americans working at $30k-$40k per year jobs. So, in essence, the US economy would have to add 113,000 new $30-$40k per year jobs just to make up for the income tax revenues lost by these 1,130 high earning Americans becoming 'former' Americans.
Even more disturbing is the fact that becoming an expatriate, and being in a position to renounce US citizenship thus US taxes, cannot be done on the 'spur of the moment'. Before the person can renounce US citizenship safely, they must first obtain citizenship in another country - a process which can take up to 5 years. Personally speaking, I still have 2 years to go in my quest for obtaining citizenship 'way south of the border'. Thus it's possible that, as the author pointed out, the statistics on expatriation we're now seeing are just the 'tip of the iceberg'.
Thoughts ?



Reply With Quote




Bookmarks