We are developing the social individualist meta-context for the future. From the very serious to the extremely frivolous... lets see what is on the mind of the Samizdata people.

Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]

Samizdata quote of the day

Yeah and so when I left (the USA) for good 5 years ago, I said fuck that. I had been living in NZ for 10 years and then moved to Costa Rica. And after some business travel to various places, I finally got sick of the bullshit, having banks and financial services company (initially) and increasingly any company everywhere in the world going “OMFG you are American!” as if I was radioactive, all because of the bullshit compliance costs I represented.

– Samizdata commenter Megan

Tweet about this on TwitterShare on FacebookShare on TumblrShare on RedditShare on Google+Share on VKEmail this to someone

17 comments to Samizdata quote of the day

  • Nick (Natural Genius) Gray

    Does anybody know if any other country has such over-reaching compliance costs? If so, which countries, and in what ways?

  • Jerry

    Stated with such breathtaking eloquence –
    Wherever you are, please stay there.
    Destroy your passport, deny your citizenship and
    become a subject of some country you admire.
    We have more than enough malcontents already

  • We have more than enough malcontents already

    No, not nearly enough or things might not have reached the point that have. But I can hardly blame Megan for doing what she needed to do to stop being hounded by the IRS when she is not even within the borders of the USA.

    But I am a great believer is people taking a cosmopolitan view of ‘citizenship’ (I have always thought ‘subject‘ was a more honest term though).

  • Does anybody know if any other country has such over-reaching compliance costs? If so, which countries, and in what ways?

    I seem to recall that Eritrea was the other country that made similar tax demands of hapless Eritrean expats.

  • Reply to Perry, yes, currently USA and Eritrea are the only two countries with a citizenship based tax.

    But Putin, having seen the advantages of such a mechanism simply to control his ‘discontents’, is in the process of legislating either a direct citizenship tax, or near to. I blogged on it here (sorry for linkspam): http://lifebehindtheirondrape.blogspot.co.nz/2014/11/fatca-gatca-gotcha-now-west-will-have.html

  • momo

    Ironic given the anniversary of the Berlin Wall coming down.

    A citizenship-based tax (vs residency) is onerous enough, but effectively barring banks from doing business with you is beyond the pale.

  • Mr Ed

    In the 1980s I knew a chap at University in the UK who had an American father and British mother, and grew up in England, he had recently elected at 18 for US citizenship, and I recall thinking even then that he was choosing to have the IRS follow him around the world all his life, and I felt that his choice was curious. Of course the United States has many advantages over most of the world in terms of opportunities with its prodigious productivity and variety of States in which to live, and not every choice in life is simply economic, there would surely be other non-material considerations.

    However I did think even then that he was choosing a less free country than the UK, where the State (back then anyway) was, although haughty, far less concerned with what its citizens did, no travel bans for various countries, no worldwide taxation, if you wanted to leave the UK you simply left and told the tax authorities that you were no longer resident, and if you changed domicile, then inheritance tax would no longer apply either.

    I see a curious echo of North Korea in the attitude of the United States to its citizens, although US citizens may check out of the USA, it is as if they can never leave.

  • Paul Marks

    Yes a single U.S. citizen on your books and the U.S. gov is after you – these regulations lead to citizens renouncing citizenship as well as going to other countries.

    The regulations will do nothing to prevent another crash – the crash in fact being caused by the credit-bubble creating policy of the Federal Reserve and other Central Banks.

  • rxc

    As a US citizen living in France, we saw the implementation of these rules when our bank manager called to arrange for us to come in for an interview. He had to meet us face-to-face, to establish that we existed and that we were who we said were. We had had this account in France for 20 years, so it was not like we just arrived with no history, but it was definitely a pain in the ass. They required forms to be filled out, annually, after that, attesting that we paid our US taxes, etc, but we never got any threats of cancellation, which would have been a disaster in France.

    That said, France (and I think other parts of the EU) are going the same way. They require you to declare all of your foreign accounts annually, on your tax return, and they do go check to see how much you have. The US can better enforce this sort of oversight because it has the ability to shut down international trade for a bank (a sort of death penalty) if they don’t comply.

    The French even have a special tax for boats in France that fly the flag of countries that they consider to harbor tax cheats – they quadruple the annual “cruising tax”, for any boat from these countries. I don’t have the list any more, but it mostly included countries in the Caribbean – don’t know whether it included Switzerland…

    The governments all want their money, and with the modern economy that allows money to travel very easily, they are going to do whatever they can to get it.

  • rxc

    Oh, and regarding the taxes, yes, the US govt insists that it had the right to tax the income of its citizens, wherever in the univers they earn that income. It has plusses and minuses. For expats like us, it meant that we did not pay any taxes in France on our pension and dividend income that came from the US. We had to file French tax returns each year and declare all of our income from the US. We then had to make two trips down to the local tax office with copies of the tax treaties and internal French government regulations in hand to explain to them why we were not taxed like Brits, and eventually they gave us the appropriate exonerations. It was stressful, but at least I understood how my taxes were calculated (sort of).

    Also, I think that the housing bubble in the US was not caused by the central banks, but more by progressive politicians who insisted that banks come up with loan programs that ensured more diversity in their portfolios. I.e., they issued loans with no down payment required to people who could not reliably pay their mobile phone bills each month. All in the name of ensuring fairness and equality and reducing the disparate impact of evil capitalistic loan practices.

    In any case, I will not renounce my US citizenship – instead, I hope to have my Italian citizenship recognized in about 2 weeks. So, then I can come live anywhere in the EU as long as I wish without having to demonstrate that I have taken courses in, and appreciate, the value of a democratic, pluralistic society.

  • llamas

    The purpose of the US law is made clear in its title, which abbreviates to FATCA – reflecting the puerile love of US lawmakers for laws with catchy names. The sole purpose of this law is to go after ‘fat cats’ who have money abroad – in other words, simple and jingoistic meat for low-information Democratic voters.

    llater,

    llamas

  • Laird

    “Ironic given the anniversary of the Berlin Wall coming down.”

    Actually, it’s not at all ironic. Megan’s post was a reply to a comment of mine to the effect that 25 years after the fall of the Berlin Wall the US is erecting its own Wall, ours being of a financial rather than physical nature. The timing was entirely intentional.

  • Dyspeptic Curmudgeon

    And Putin will soon, of course, e-institute Stalin’s “laws” that anyone with any connection to the lands of the USSR, is thereby a “citizen” and subject to Russian control. Including Ukrainians. (qv the Yalta agreements whereby White Russians/Cossacks who had never accepted communist authority were forcibly “repatriated” to soviet control.

  • Vinegar Joe

    Jerry, you’re content with the direction America has taken the past 50 years?

    Seriously?????

  • Paul Marks

    Vinegar Joe, I wonder if Jerry understands that all the Founding Fathers (even Hamilton) would have been utterly disgusted by the size and scope of the American Federal government.

    Neither the Tenth Amendment nor the Forth Amendment seems to mean anything anymore, the government can do anything it likes.

    I do not believe that Jerry can be really happy about a situation where the Founding Fathers would be looking to (for example) renounce citizenship.

  • Eric

    I was sort of hoping the rest of the world would finally have had enough with FACTA. The US can certainly give some small number of banks the “death penalty”, but if, say, all the European countries threatened to shut US banks out of Europe that would be the end of it.

    Of course I wasn’t cynical enough. It should have been obvious other governments would just use it as an excuse to tax their own expats.

  • Laird

    “It should have been obvious other governments would just use it as an excuse to tax their own expats.”

    Bingo!