United States Citizens Jumping Ship Over Taxes — Following Superman’s Lead?

Superman said enough is enough...will you?

Back in 2011, iconic comic book hero Superman went political, citing his plans to dismiss his citizenship to the United States.  The superhero said that “Truth, justice, and the American way” wasn’t enough anymore.  The retort was aimed at criticism Superman received from Iran and the United States when he fictionally joined a peaceful government protest in Tehran.  Think Superman doesn’t have any clout?  Think again.  In 2011, just under 1800 Americans renounced their United States citizenship, a record number in modern times.  To give you a meter on this, that is more than renounced their citizenship in 2007, 2008, and 2009.  Altogether.

However, while many Americans may be following Superman’s lead, they are doing it for much less philosophical reasons.  People are turning their back on American citizenship, once regarded as a great right, because of the tax burden placed on them.  Most countries in the world don’t tax income when a person is living in another country, but the United States is one of a very few that continues to institute income tax on citizens that are no longer living in the country.  So, what that means is that American citizens that have moved to other countries must pay taxes not just in the country they reside in but also to the United States as well.  The only way for them to get out of this tax obligation is to repeal their United States citizenship.

The government can’t make up its mind on just how many American defectors are out there.  While the official number reported by the Internal Revenue Service is around 1,788, it is widely known that the number is not accurate and may be potentially thousands short of the real data.  The IRS shows that number, while the State Department says that a steady rate of around 1,100 people renounce their citizenship each year.  Lawyers for people that have taken this drastic measure to save money say that the IRS only reports the list to cast shame on those that renounce.  The idea is that the government casts a bad light on these individuals because it is seen that they are all about the money.  They are willing to forego their citizenship in America to save some money.  The government hopes that by publishing this information, people will be less likely to do so, which means more money to line the government’s pockets.

Don’t worry, taxpayers.  The government gets one last jab in at those who choose to go through with the renouncement of their citizenship.  The so-called “exit tax” takes one last chunk of the pie when people opt to get out.  And they have to pay, or face criminal charges which would make it impossible for them to come back to the United States to visit family and friends for fear of arrest.  So, rest assured that the government gets a last laugh on those that try to dodge the very rare out-of-country income tax.

So, in the end, the moral of the story is that Americans are willing to become ex-Americans to get out of paying taxes twice.  What does this say for the institution of our country, when people are willing to part with their actual citizenship because they are tired of paying unnecessary taxes?  The government, which if it were classified as a business operates at a loss year after year, continues to take take take.  And little regard is given to how the income is made, or where it is made.

“Truth, justice and the American way…it’s not enough anymore.”

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