Thanks for the link and thanks for pointing out that my info was outdated. I read a different article on Mondaq. When the act was first passed, I listened to a lawyer talk about the double tax implications and the constitutionality of this double tax. They may have just decided to remove the double taxation rather than go through the hassle of having the Supreme Court remove it for them. I guess "draconian" is in the eye of the beholder. People who are high earners and have no assets win because they are no longer subject to taxation but people who have saved diligently all their lives get robbed on their way out the door just for choosing to give up U.S. citizenship. It's amazing how government consistently rewards imprudence at the expense of prudence while its representatives endlessly moan about the low savings rate in this country. Ya think?! Ahhh, government.
yeah, if you republicans would have managed to privatize social security....man now THAT would have been awesome!
What's also interesting about the Exit Tax is its history of former implementers: Nazi Germany and Soviet Russia. Now the USA is on the list.. I guess you could list France under an addendum since it tried to block its wealthy from fleeing to Monaco by surrounding the principality with an army of tanks. However, that was only a short term measure. What I don't understand about the Exit Tax (or even the prior 10-year tax) is how they're effectively enforced. Anyone considering such an action has likely already shifted their assets offshore. If you're living offshore with assets offshore, and then go to the local embassy to renounce, how they heck are they going to make sure you paid?
You have to have approval from the Treasury in order to get it legally done. They will reject your renunciation if you haven't squared accts with the IRS. Moving all your assets offshore only helps if you are never going back and have no US sourced income and don't mind evading on future foreign earnings. Doubtful they'll ever pursue you offshore. The people who go through all the hassle are people who foresee returning to visit or have US sourced income. You wouldn't want to burn that bridge if you trade US markets with a US broker for instance.
Soviet Russia raped us of our meager assets on the way out. Nice to see the U.S. going in the same direction [/sarcasm] As far as I could tell from the article on Mondaq, the tax is not only on U.S. assets - it's on worldwide assets.
It's "Government at the expense of the people" almost everywhere on the planet... including the US. If enough of us understood that, we'd be working on true government reform... not flipping the ball back and forth between parties so that each can take its self-serving, greedy and destructive turn at the wheel.
Well, it's hard to argue with that logic. The problem is that we must elect people to government and the elected have no incentive to reduce their power - only to increase it. Truly terrifying.