Sens. Schumer and Casey Propose Bill To Tax And Banish Rich Expatriates
Facebook co-founder Eduardo Saverin may have gotten the short end of the stick from Mark Zuckerberg, but on Thursday, Sens. Charles Schumer and Bob Casey announced they plan to punish Mr. Saverin and other expatriates like him by slapping a 30 percent tax on capital gains for those who renounce their U.S. citizenship and permanently barring reentry into the country.
The plan, known as the "Ex-PATRIOT (Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy) Act, is a response to what Sens. Schumer and Casey say was a "scheme" by Mr. Saverin to "help him duck up to $67 million in taxes." In September 2011, Mr. Saverin renounced his U.S. citizenship and lives in Singapore which does not require individuals to pay capital gains taxes.
“Mr. Saverin has decided to ‘defriend’ the United States of America just to avoid paying his taxes. We aren’t going to let him get away with it so easily,” Schumer said. “It’s infuriating to see someone sell out the country that welcomed him and kept him safe, educated him and helped him become a billionaire. This is a great American success story gone horribly wrong. We plan to put a stop to this tax avoidance scheme. There should be no financial gain from renouncing your country.”
Sen. Casey agreed: “We simply cannot allow the ultra-wealthy to write their own rules,” said Senator Casey. “Mr. Saverin has benefited greatly from being a citizen of the United States but he has chosen to cast it aside and leave U.S. taxpayers with the bill. Renouncing citizenship to simply avoid paying your fair share is an insult to middle class Americans and we will not accept it.”
Mr. Saverin, who says he’s already paid an “exit tax,” took issue with Schumer and Casey’s characterizations: “This had nothing to do with taxes,” he told the New York Times. “I was born in Brazil, I was an American citizen for about 10 years. I thought of myself as a global citizen.”
The Ex-Patriot Act, which The Atlantic calls a “creepy law,” would apply only to those with a net worth of $2 million or higher or individuals whose average tax liability over five years was $148,000 or higher.