Posted on 06/29/2008 4:41:06 PM PDT by Coffee200am
A lot of people probably can't understand why someone would voluntarily give up American citizenship -- but if someone wanted to do that, they'd now incur financial penalties for it.
Congress just passed a new law that will stop your capital -- or at least a good portion of it -- at the border, should you decide not to be a U.S. citizen anymore. Is it, perhaps, in preparation for the possibility that Americans might rebel at the debt and taxes incurred by their government by leaving for lower-tax locales?
You probably didn't notice this little provision inserted into the Heroes Act of 2008, passed by Congress on June 17. The headlines in the press release about the law were about the increased benefits for veterans and families of deceased military.
But Richard Kohan of Price WaterhouseCoopers drew my attention to one section of the act, which states that anyone voluntarily giving up his or her citizenship will be taxed on all of his assets as if he or she had sold them -- paying capital gains on assets that have increased in value, even though they have not been sold.
That's right. While everyone in the media is focused on keeping aliens out of America, Congress has voted to lock its citizens - or at least a good portion of their assets -- into America! Maybe they're thinking that patriotism won't be enough to keep the smart money from recognizing the coming increases in the tax burden.
Patriotism and Debt
We expect our elected leaders to be patriotic, to wear flap pins on their lapels? But how patriotic is it for our elected officials of both parties to drag our country into debt?
This year the Federal budget deficit will be a record $400 billion. That astonishing number will be added to our existing $9 trillion national debt. It's money that our government spends in excess of what it collects in taxes.
Government officials say they're shocked at the record number of American consumers who are filing for bankruptcy. Yet those same politicians are spending America into an effective bankruptcy -- building a burden of current debt and promises of future debt that can never be repaid. Now, how patriotic is that?
Patriotism and Taxes
Do you consider it your patriotic duty to pay your taxes? Do you feel unpatriotic because you spend some time trying to figure out how to reduce your tax burden, by maximizing deductions whenever possible?
If that's not unpatriotic for you, is it unpatriotic for wealthy people, or corporations, to try to reduce their tax burden? Where do you draw the line? Perhaps it's most unpatriotic for our elected officials to construct a tax system that doles out benefits to special interest groups, pitting one group of Americans against another.
What's really unpatriotic, in my opinion, is trying to divide Americans through the politics of envy. Our country has moved forward because of our optimism and our belief that any American can build a better financial future. It has been our nature to honor those who have been successful, and seek to emulate them, not to destroy them because they have more assets or income.
Of course, that presupposes that the successful people accept their patriotic responsibility to give back to the society that made their success possible. And the facts show that Americans are the most charitable and generous people on the planet.
Think of Warren Buffett and Bill Gates, literally giving away their fortunes to help humanity. Or think of the people who filled sandbags along the Mississippi this month to save the homes of strangers.
When a government encourages the best in its citizens, by its policies and its example, patriotic citizens rise to the occasion. And when a government burdens its citizens, it inspires dissent and departures.
The Beatles famously left Britain, and Bjorn Borg left Sweden, when their governments raised taxes to such high levels that even these national icons departed. Are American lawmakers preparing for that kind of scenario with this new law?
Now in America, you can love it, or leave it -- but you can't take it all with you. And that's the Savage Truth!
But it does bring back memories.
/johnny
Who didn’t see this coming - seems we can’t get rid of the “death tax” for good either.
Simple enough to get around: just transfer 100% of your assets to safe havens overseas, ahead of time before the democrat party can steal your funds. (the Mark Rich/George Soros technique)
/johnny
see #4 - but I bet you’d get caught fairly quickly
...if you walk away we’ll tax your feet...
(apologies to The Beatles)
What a crock, that Congress should pass laws penalizing citizens for moving capital out of the US when there are billions going to Mexico illegally every year. Hypocrites!
Land of the Free my @ss.
And all this time, I thought Bush, McCain , Teddy and the other the open borders government hacks didn’t place a value on American Citizenship!
Move the money out of reach well before renouncing your citizenship...the types who do that sort of thing never were real Americans anyway, but ultra lib “world citizens”.
I feel it’s every American’s patriotic duty to pay as LITTLE to the federal government in taxes as possible. Otherwise, we are nothing but enablers for our elected pathological spendthrifts.
This may not be about people leaving the country but in the event of a civil uprising. I mean, how many people give up their citizenship? They may pack up and move to a resort in Mexico but they remain citizens.
We should be taxing “financial transfers” to Mexico and Guatamala and El Salvador at the max tax rate on the way out PLUS the civil penalties for not filing tax returns.
American version of the Berlin Wall, let the people go, keep the money.
Idiots. You can’t tax talent, intelligence, or hard work ethic. Take a self made wealthy genius in any field: America becomes a hell hole for him/her and they decide to leave. Even if the government threatened to take everything they had, there are many governments around the world that are willing to replace anything they lose and then some for them to leave.
Socialist idiots.
With no tax penalties either. That is a very good point. Come over here illegally. Take money from a job, illegally. Send money to another country, questionably illegally, or at least untaxed. But if you are a citizen and don’t want to stay to the snot taxed out of you, they can steal, and I use the word stealing because that is what it is, you money.
This isn’t the country I grew up in.
Note to self:Before renouncing my US citizenship make sure to get all my $$$ and assets out of the US.
What is really ridiculous about the US tax code is that if I live and work in another country, I am still taxed by good ol’ Uncle Sam! That means I am paying income taxes in the US and the country in which I am living and working. Fantastic.
I bet you I wouldn’t.
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