Perhaps one of the most famous was the co-founder of Google, Eduardo Saverin, who avoided huge taxes — estimated at $96 billion — when the company went public by renouncing his citizenship in favor of Brazil, where he was born. When the dollars become large enough, the tax and reporting consequences take on huge importance.
The Irony of FATCA
Perhaps the greatest irony of FATCA is that it grew out of the 2010 Act that was titled: “Hiring Incentives to Restore Employment Act.” But instead of contributing to economic growth, FATCA has just put another regulatory and reporting burden on global financial trade, throwing a roadblock into the free markets that move money to where it gets the best risk-based return.
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This law is unfair to individuals compared to corporations, which can earn money abroad and not pay taxes until, and unless, they repatriate it. Since the tax rates here are much higher for companies than in most of Europe, a lot of that money stays overseas — and is not used to create jobs in the United States. In fact, some companies are merging with European corporations just to become taxpayers in those countries instead of the United States.
If U.S. citizens want to seek out investments abroad with the money they have earned and paid taxes upon, the government shouldn’t stand in the way. Instead, it should concentrate on making the U.S. the best and most attractive place to invest by cutting tax rates and encouraging growth. And that’s the Savage Truth.
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