I wouldn't count on that - citizenship rule is unlikely to protect you from a transaction tax - it does not exempt you from UK's Stamp Duty... In fact transaction taxes are rather unique in the history of international tax laws in that it they manage to tax everyone, regardless of their nationality and the country of residence. Moreover, *both* nationality and the country of residence can be used by the IRS against the taxed subjects, but neither can be used to claim an exemption. First, just like with the capital gains tax, those US citizens who become expatriates for the purpose of tax avoidance (and it is 'irrefutably presumed' to make things easier for the IRS, as in: 'the presumption of innocence', would be chased by the taxwoman all over the world for 10 years after they have become non-residents (see [1] and then perhaps [2] if you needed some tax shelter ideas from the Expatriate Tax Second, non-resident aliens trading US stocks from abroad (such as yours truly) would have a tax liability to the US government (receiving no rights in return), because while international tax laws prohibit discrimination on the basis of nationality and use *residence* instead as the 'connecting factor': "national tax law provisions must avoid any overt or covert discrimination on the basis of nationality (see, in particular, Wielockx, paragraph 16, and Case C-385/00 De Groot [2002] ECR I-11819, paragraph 75)."[1] "for tax purposes, residence is the connecting factor on which current international tax law, in particular the Model Convention of the Organisation for Economic Cooperation and Development (OECD) (Model Convention on Double Taxation concerning Income and Capital, Report of the Tax Affairs Committee of the OECD, 1977, version of 29 April 2000), is as a rule founded for the purpose of allocating powers of taxation between States in situations involving extraneous elements."[1] ..the residence rule applies only to *double-taxation* (cf. the 'extraneous elements' above), while in case of a unilaterally-imposed taxes, anything goes really - so they would also tax foreign residens who have never been US citizens, not even within the past 10 years. Neither nationality nor residence could be used to claim exemption, because: 1. If you tried to claim foreign residence to obtain tax exemption, you would not achieve much, because: a) if you are a US citizen, the Expatriate Tax would be applicable for 10 years after you leave America (see [2] for solutions, b) if you are a non-resident alien, international treaties do not apply, because the tax is unilateral. 2. If you tried to claim foreign nationality to obtain tax exemption, you've guessed - nothing gained either, because: a) US citizens (having double citizenship) are automatically taxed simply because they are US citizens, b) resident aliens are treated on par with US citizens, c) non-resident aliens cannot claim international treaty protection, because no double taxation is involved. Seems IRS would have all bases covered... so better hurry up with point [2] exemption, because that international marriage loophole would also go once it gets too popular That same loophole could be also used by international traders, but in reverse - they could apply it with one extra step (obtaining US green card / citizenship and then marrying abroad). Of course that would work only if the new financial transactions tax were treated in the same 'lenient' way as the capital gains tax, i.e. if it became incorporated into the Expatriate tax, rather than having no exemptions whatsoever (I know exactly what you are thinking ___________ [1] La Torre-Jeker, Virginia. Expatriate Tax Warning. Hong-Kong Lawyer, July 1997, page 34, URL: http://sunzi1.lib.hku.hk/hkjo/view/15/1501197.pdf [2] A Comprehensive Inventory of Low-maintentance Tax Shelters for the purpose of US Expatriate Tax Avoidance, URL: http://www.fotka.pl [3] EUR-Lex, URL: http://eur-lex.europa.eu/Notice.do?...,pt,sk,sl,sv,&val=429314:cs&page=&hwords=null
The only reference I can find where DSK mentions 'one off tax' is in reference to a one off tax on banks earnings (or assets) - a one time windfall tax. I believe thats where this comment was taken out of context from. It sure seems like the entire world is waiting for the IMF report due in April of next year regarding the tobin tax and the insurance type levy, etc. I just can't believe the IMF would come out in favor of the tax after they have called it unworkable, etc recently on several occasions. Let's hope for the best, -Guru
Please help post the link to GreenTraderTax to the trader bulletin boards you know. http://www.rallycongress.com/greentradertax-traders-association1/
Sen. Kirsten Gillibrand (D-N.Y.) "Gillibrand seems to be against the much talked-about transaction tax " http://www.nypost.com/p/news/business/banks_need_to_lend_now_wIZJF5AD5gzJPV8ICjaByK
While I am aware that no one person can make law, but I just thought I'd repeat something from earlier this week that, while doesn't put us in the clear, it certainly helps: âDonât think weâre not keeping score, brother,â Obama told DeFazio during a closed-door meeting of the House Democratic Caucus, according to members afterward. http://thehill.com/homenews/house/72889-pelosi-rahm-do-not-scare-rep-defazio
Haven't been keeping up with this thread, so I apologize in advance if this topic has been broached already... Just wondering where do you guys think retail rates will go if this tranny tax becomes law? How many brokers do you think will start offering free trades? Do you think the NYSE will start paying more for order flow? Do you think some brokers might even go so far as to pay YOU for your orders? +-*/ Math_Wiz
This is not new. US citizens are already responsible for paying taxes no matter where they earn their money. See the recent suit and settlement with UBS over Swiss bank accounts.
TT's are suppose to happen at the exchange level and anyone trading on a exchange in US is going to pay it despite their nationality. If any US citizens trade on exchanges that doesn't have TT then the question of them paying TT doesn't arise.
India is removing their own TT, http://www.indianexpress.com/news/A-fine-balancing-act/556840 this is just and initial draft but it looks good.