Congress Killed Expatriate Tax Once Before in 1995
NEW YORK (TheStreet) -- Sen. Chuck Schumer (D., N.Y.) and Sen. Bob Casey (D. Pa.) announced plans Thursday to unveil their proposed "Ex-PATRIOT" or "Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy" legislation seeking to re-impose taxes on ex-citizens.
But this isn't a particularly new idea.
|Clinton complained in 1995 about Americans who renounced citizenship to dodge taxes.|
Back in 1995, President Bill Clinton spoke on multiple occasions about this topic and the Senate even passed a nonbinding measure to clamp down Americans who renounced their citizenship, according to a White House press release and Reuters article from that year.
"Billionaires who make their fortunes in this country ought to pay taxes here like everyone else," Clinton said back then.
Schumer and Casey made their comments in direct response to public documents that revealed Facebook(FB) co-founder Eduardo Saverin had renounced his citizenship months ahead of an historic initial public offering of the social Web site.
They called Saverin's decision a scheme, and said it would "help him duck up to $67 million in taxes," according to ABC News.
The U.S. Treasury targeted "super rich" citizenship deserters in 1995, even though the department estimated that only about two dozen people renounce U.S. citizenship every year for the single purpose of avoiding taxes, according to a Dow Jones report back in 1995.
Clinton's administration proposed to change tax regulations on these citizens-turned-expatriates by requiring them "to pay taxes on unrealized gains when they renounce their U.S. citizenship," according to the Dow Jones article.
Schumer and Casey, according to reports, are looking to levy a 30% capital gains tax on those who renounce and bar them from every returning to the United States.
Schumer and Casey haven't formally unveiled the Ex-PATRIOT act, but the pending legislation's distant 1995 version didn't fare so well: It lost a party-line vote 224-to-201 after Republicans panned the bill.
-- Written by Joe Deaux in New York.