Guest Post: US Citizens Now One Step Closer To Becoming Permanent Tax Slaves

Tyler Durden's picture

Submitted by Simon Black of Sovereign Man

US Citizens Now One Step Closer To Becoming Permanent Tax Slaves

This week, the universally stupid brainchild of US Senators Chuck Schumer and Bob Casey known as the Ex-PATRIOT Act inched a bit closer towards becoming law.

‘Ex-PATRIOT’ is an absurd acronym that stands for “Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy”. I call it the Tax Slave Act… and it proposes three key provisions:

1) Individuals who are deemed, in the sole discretion of the US government, to have renounced US citizenship in order to avoid US taxes, will be permanently barred from re-entering the United States.

2) Such individuals will also be required to pay a 30% capital gains tax to the United States government on ALL future investment gains derived from the US. Currently, non-citizens who do not reside in the US pay no US capital gains tax.

3) These proposals are RETROACTIVE, and, if passed, would apply to anyone who renounced his/her citizenship within the last 10-years.

During a Sunday interview with ABC News, House Speaker John Boehner threw his support behind the bill… certainly a big step towards its eventual passage.

Let’s pause briefly for a little history lesson–

Dart Container Corporation was founded in 1960 by William F. Dart, the man who first perfected the design of styrofoam. Dart Container is today a multi-billion dollar family-owned company with thousands of employees and operations around the world.

In the early 1990s, brothers Kenneth and Robert Dart, heirs to the family fortune, renounced their US citizenship and became citizens of Belize and Ireland, and set up residency in the Cayman Islands.

Around the same time, several other wealthy Americans renounced citizenship, including Carnival Cruise Lines founder Ted Arison (who obtained Israeli citizenship), Campbell Soup heir John Dorrance (Irish citizenship), and fund manager Mark Mobius (German citizenship).

President Clinton was furious, and in 1996, he pushed Congress to pass a series of financial penalties for people who renounce citizenship. At the time, a ‘renunciant’ had to continue filing US tax returns for 10-years after renouncing.

Effectively, though, this penalty was a tax on worldwide income, not an exit tax on assets.

Fast forward to the mid-2000s, a time when the asset bubble was at its peak; the stock market was at its all-time high and real estate prices kept going up.

The Bush regime passed a series of changes to expatriation rules, dropping the income tax filing requirements in lieu of charging a one-time exit tax on assets.

In this way, the government was able to derive a much larger payment up front based on total assets rather than chasing around a former citizen for a piece of annual income.

In the years since the exit tax on assets was established, two things have happened:

1) The number of Americans renouncing US citizenship has risen steadily, from 235 people in 2008 to 1,780 last year (according to Schumer’s office).

2) The asset bubble has burst, and assets are worth much less than just a few years ago. As such, the government isn’t collecting as much revenue from the exit tax.

My sense is that the government has been watching the number of expatriates rise over the years, and simultaneously watching the value of the exit tax fall… and they’ve been looking for an excuse to make sweeping (i.e. retroactive) changes.

Eduardo Saverin is the perfect excuse. The Facebook co-founder’s recent renunciation of US citizenship has become a rallying cry for politicians to go back in time and steal money from former citizens retroactively…plus establish a larger base for future tax revenues.

This is a truly despicable thing to do considering that these former citizens followed the appropriate rules at the time, paid the tax, and moved on with their lives. Now Uncle Sam wants to go back in time to unilaterally change the deal, and expect everyone to abide even though they’re not even citizens anymore. The arrogance is overwhelming.

More importantly, this bill is also a major deterrent for people who are thinking about renouncing US citizenship today.

The passage of this law will undoubtedly cause many people who were considering expatriation to abandon the idea altogether as the thought of being permanently barred from entry is too much to bear.

It’s truly extraordinary that the Land of the Free has deteriorated to the point that the government must now resort to threats, coercion, and intimidation in order to keep its most productive citizens inside.

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Ahmeexnal's picture

Welcome to socialism!

LawsofPhysics's picture

Welcome to fascism-  fixed.

pods's picture

Can you smell that?  That freedom smell?  Nothing else smells like that.

Smells like...............tyranny.


theMAXILOPEZpsycho's picture

Its utterly abhorrent that at a time like this people aren't prepared to pay their fair share; while we have important institutions wobbling under the strain all people on zero hedge are worried about is how much they should be asked to chip in. ASK NOT WHAT SOCIETY CAN DO FOR YOU BUT WHAT YOU CAN DO FOR SOCIETY! This needs to be drilled into our school children so we don't end up with another generation like the one that lead to the financial crisis through greed, selfishness, and lack of social responsibility. I often agree to work over time in my job of regulating small businesses for the government. People on ZH need to start living in the real world; I'm out there making a real difference every day; I get a good paycheck and huge job satisfaction. They tell me there aren't chances out there - well I'm living proof there is...

pods's picture

Comforting to know that a person with "psycho" in his moniker is working overtime for the government to fix things.


By the way, Hitler made a difference too.


moondog's picture

Sociopaths make great politicians, CEO's....and government regulators.

Precious's picture

... the land of the free and the home of the brave.

casey13's picture

I bet most Americans though the southern border fences were built to keep people out! 

Oh regional Indian's picture


Highly recommended above. Mind-popping. Sad fact is that a very large part of the world is in tax-by-treaty slavery to the Queen of E. The sun never did set on the BE. It is just behind a cloud. I sense this Olympics is somehow a key window. Expose some nonsense to the world, sleight of hand, 2Pac live a Loollaaapppalooza, somebody will arise.....

Munich comes to mind. 

But the tax slavery part? Old pope Bonafice will have to revoke his Papal Bull of 1273 or thereabouts and then on down, via Venice to today.

Chattle and Serf and now Tax Payers (Energy Units) in their eyes.




nmewn's picture

Well, at least the assholes are showing their true colors.

They believe earnings (legally aquired) are theirs to toy with, not the one who earned retroactively screw around with.

And everyone wonders why no one wants to do business here or why anyone would want to 

Pladizow's picture

What % of your wealth would you give up for freedom?

sunaJ's picture

This is a silly threat.  We all know it is extremely easy to sneak into this country.

Leopold B. Scotch's picture

You'll be surprised at just how effective the turf is protected against these renunciants.

francis_sawyer's picture

Hey maybe while Congress is at it, it could just write a law to require everyone on the planet, regardless of where they were born, to pay US taxes...

illyia's picture

How about a law to retroactively make OTC off balance sheet derivatives illegal? With a big enough fine we could kill a pc of the debt !

Peter Pan's picture

I think this proposed law is really aimed at stopping the Mexicans from fleeing the USA. LOL.

Precious's picture

Freedom is 100 percent the absence of materialism.  A sliding scale.


Freedom <- - - -> Materialism

100 - - - - - 50 - - - - - - 0

francis_sawyer's picture

Freedom's just another word for nothing left to lose... (and here in the FREE USA, they are sure take everything you have until the point you have nothing left to lose)

lemonobrien's picture

what if i just owns golds?

NewWorldOrange's picture

Like Tyler Durden said, "The stuff you own ends up owning you."

ManOfBliss's picture

Tyler Durden in Fight Club was also an anarcho-communist.

spekulatn's picture

Moondog's post reminded me,


Understanding how psychopaths manipulate others is key to improving the odds you won’t get duped in the future.

El Viejo's picture

To be a successful psychopath you first have to be a con artist and it helps to look good in a suit.

You really can't blame people for wanting to leave after all corporations left in the 80s. 

Joe The Plumber's picture


An MDB clone

And not bad for an amateur

Taint Boil's picture



theMAXILOPEZpsycho = MDB ???

Harlequin001's picture

If you possess it you don't own it...

denny69's picture

We're not being asked to 'chip in'. We're being asked to 'chunk in'. Big difference. Wish you hadn't mentioned 'regulating small businesses'. Stop doing that right now and turn your sights upon Goldman and Morgan. If you've read statistics on small businesses, you've most likely noticed that they're going belly up at a rate faster than ever before. We're turning into a nation of corporations, not entreprenurial enterprises. You should be trying to help small businesses survive, not helping them become even more overburdened than before. I hope your 'satisfaction' isn't connected to shutting them down or making them pay more taxes.

azusgm's picture

I think that was >sarc< I smelled while reading his post. At least I hope so.

moondog's picture

Thank you for your service to the people of these United States. Thank you for your selfless work in providing government regulation for small businesses. Thank you for working overtime. Thank you for the value you add to our society. /SARC

Mercury's picture

 They tell me there aren't chances out there - well I'm living proof there is...

Yeah, seeking rents for the government.  No argument here.

BeetleBailey's picture

"Fair share"?????

Let's start and end with that.

WHO THE HELL SETS THAT BAR? Some asswipe taxwipe and members of Congress - most all who ought to be impeached.

Jesus Mary and sound like a fucking Obama speech.

Banks? Important Institutions? Then you go on to say "the financial crisis through greed, selfishness, and lack of social responsibility." THAT WAS THE BANKS, POLITICIANS AND GREED, RIPPING OFF THIS COUNTRY AND THE WORLD.

Wake up fool. It's douchebags like YOU who need to be put in their place. "Work overtime" to regulate small businesses.

I just have a 2" pecker - and take it out on others every single day. Huge satisfaction - what a cunt.

Just the phrase "drilling it into our children" ought to get you a swift kick in your self-righteous balls.

IT IS WE WHO LIVE IN THE REAL WORLD. You live in your own world of douchemania.

Go troll somewhere else.

William113's picture

Your not from here are ya BOY.

Remember these people they are the ones who say I didn't vote for that person or I didn't support that. They are your neighbors watch them closely.

Kastorsky's picture

>my job of regulating small businesses for the government<<

He's a useless government shill.

Sucking blood out of productive economy.

Somehow he confuses having government job with being successful.

We'll see how successful you are when there is no money to pay for lazy bums like you and you get thrown out by your beloved government.

And always remember you are paid with money stolen from good working people!

theMAXILOPEZpsycho's picture

For the record. I am not paid to come onto ZH and see what government opponents are saying. However, the reason I do come here is I think it might be fruitful to find out what government opponents are saying. It helps me do my job better, as I get inside the mindset of society's opponents. Eventually, I may produce a report and present it to my superiors - that's the kind of attitude you guys could do with if you want to get ahead.

illyia's picture

In the middle of the last century they called them Brownshirts. What shall we call you?

Leopold B. Scotch's picture

He's pulling your leg.  I think.

Taint Boil's picture



Sounds like MDB.  I recognize the style …. Sneaky, LOL, does anyone else see it?

NewWorldOrange's picture

MDB? No matter. But I noted that he referred to ZH readers as "society's opponents." Well, if by "society" he means an Establishment that is trying to destroy the rule of law, shred the Constitution, invoke a nanny police state, tax us into early graves, destroy our national heritage and wealth, while lying to us at every juncture, then yeah, I'd say most of us are probably "society's opponents." I sure as hell am.

suteibu's picture

OH! A report! Why didn't you say that to begin with? Surely there is nothing more productive than some low-level bureaucrat filing a report with their superior in order to make a career-enhancing there? To be sure it will lead to millions of more jobs created by the government.

Antifederalist's picture

"Present it to my superiors", well, that doesn't narrow the field very much.

"That is the kind of attitude you guys could do with if you want to get ahead."

Get ahead in a political/government system?  You are kidding right?  I assume your posts are sarcasm because nobody could be this stupid.

Get off our blog.  You add no value.

Dick Buttkiss's picture

Pretty clever, I must say, Maxi. Enough, at least, to yank the chains of a handful of credulous ZHers.

Will you be working overtime today to make sure that small businesses stay that way before succumbing to regulatory suffocation?

erheault's picture

Your beloved government has every american Man Woman and child in debt over 80 thousand dollars each and it is growing by the minute, We are heading for 16 trillion in debt a trillion seconds = 20 thousand years,  Pass that along to your superiors. 

hankwil74's picture

Those who can, do.  Those who can't, regulate.

El Viejo's picture

Yeah, here is a good example: "You must use energy efficient light bulbs"


Hopeless for Change's picture

People in government jobs need to start living in the real world, not this revolving door between academia (indoctrination of liberalism) and government.  That death sprial needs to be upended.

Things that go bump's picture

We can all just renounce our citizenship in spirit and remain right here in situ, removing our property, as best we can, from the state's grasp and refusing to be assimulated into the borg.  Resistance may not be futile after all, and does not need to be violent to be effective. As things progress there is no way they will allow you to keep any property they can get their hands on in any case. They will need it to pay the bills and support the lifestyles of your betters, so you may as well abandon hope now, while it may do some good.  Practice civil disobedience every day.  Embrace it as a lifestyle. TheMAXILOPEZpsycho is commiting necrophilia.

Citxmech's picture

If this passes - it'll just be another govt. sponsored ad for PMs and another nail in the coffin for crumbling Rome.

Papasmurf's picture

You did an amazing job to get -65/0 thumbs down. I would say this is unprescendented on zerohedge.   You must be way up the food chain where you never produced anything of value for anyone ever in your life and think that arriving at a bank or gov't agency every day is a productive activity.  Good luck when things get bad.  Have you ever changed the oil on your car, changed a faucet washer, changes a shoe lace that wore?  I think you take the cake for clueless.   

Antifederalist's picture

Pay their fair share?  How about the 50% of the population that pays ZERO tax?   I would guess the average Zero Hedge reader is employed in a productive position, does not suck on the government tit for benefits or a salary and pays taxes.  That is more than you can say for half of our country.  Including yourself.

theMAXILOPEZpsycho:  you need to educate yourself.  Collectivism does not work.  It is not greed selfishness and lack of social responsibility that caused the financial crisis.  It is fiat money, crony capitalism, socialism and lack of rule of law that caused the financial crisis. 

Educate yourself, then come back with something useful to say.