Citizens say bye to American dream
A greater number of people are renouncing US citizenship, but it’s not because of politics, say experts, it’s just economical
It can be difficult to become a US citizen. A lot of people put a large amount of time, effort and money into the process of gaining an American passport or, failing that, the right to permanent residency.
But to some people, US citizenship can apparently be a burden. And it’s a burden that people seem to be shaking off in increasing numbers. This week, the Treasury Department released its quarterly list of individuals who had chosen to “expatriate” — i.e., renounced their US citizenship or gave up their rights to permanent residence.
The list is notable for a couple of reasons. First off, Britain’s Foreign Secretary Boris Johnson is on it. This means that Johnson, a dual-national who was born in New York City, has finally renounced his citizenship.
Secondly — and far more importantly in the grand scheme of things — the list shows that Johnson is just one of a total 5,411 individuals to expatriate in 2016.
As law firm Andrew Mitchel LLC noted on its blog, this was a 26 per cent increase over 2015, when there were 4,279 names on the list. And it is a 58 per cent increase over 2014, when there were 3,415 names on the list. As data collected by the firm showed, while the number of individuals who expatriated from the US had stayed pretty flat from the 1960s — and actually dipping for a while in the 1990s and early 2000s — over the past five years, it has dramatically surged upward.
The number of people giving up their US citizenship may in fact be higher. Ryan Dunn, a lawyer with Andrew Mitchel LLC, explained via email that his firm has suspicions that the lists released by Treasury are incomplete. However, this would not change the trend. America is seeing what is likely a historically high level of expatriation. And it seems only likely to rise further.
But why would anyone renounce their citizenship to the United States? Dunn said that in his firm’s experience, it wasn’t usually political. “We have not been contacted by anyone saying that they wanted to give up their citizenship because Trump won the election,” he said. Instead the motivation was simpler: money.
It’s taxes, not Trump
The US is one of the only countries in the world that requires its citizens and permanent residents to file taxes even when they live abroad.
Giving up your citizenship isn’t necessarily cheap either. It can take a long time to get an appointment in some places, and the processing fee is around $2,350 (Dh8,631). More important, Dunn said, was the “exit tax” that some high-earning or high-networth individuals have to pay. But evidently, for some people it’s worth it. (Green-card holders have a simpler and cheaper process.)