On his road to becoming a billionaire, Facebook co-founder Eduardo Saverin took advantage of some of the best opportunities the United States has to offer: a Harvard education, access to wealthy investors, and a justice system that makes investments possible. But as soon as it became clear last year that Saverin would owe the United States government hundreds of millions of dollars in taxes after the company he co-founded went public, Saverin began taking steps to renounce his US citizenship and declare his residency in Singapore, which has no capital gains tax.
His actions have elicited outrage from the public and from a handful of politicians. New York Senator Chuck Schumer and Pennsylvania Senator Bob Casey unveiled a bill that would force anyone who expatriates the country for tax purposes to pay 30 percent tax on future capital gains. The bill would also ban the tax-dodgers from entering back into the United States. Senator Jack Reed of Rhode Island believes the Obama administration already has the power to enforce that travel ban because of an amendment Reed wrote as a House member back in 1996. Reed is encouraging the administration to exercise that power now, even though the law has never been enforced.
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East Germany put up a wall and appropriated people's possessions. Sounds like the Globe plan for encouraging investment in America.
Nonsense. This is a free society; you're advocating for the opposite. If you have left an opening in the tax law, fix it; but this guy, as I understand it, followed the law. Cleverly, and unpatriotically, but he followed it. And now Chuck Schumer whines because he did not get his piece of the action...typical. Tough luck, Chuck.
What he did was perfectly legal, and it underscores a point so many people do not understand: Tax policies have a direct effect on human behavior. That is why higher tax rates do not create much in new revenue. and why lower rates often lead to greater tax revenue. The challenge for government is to have a tax system which creates the right incentives, to maximize economic growth. Punitive tax measures, as are being discussed here, do not work, as behavior will change to avoid whatever the penalty is.
Ahh, the typical modern American. Please give me all the benefits, but I do not wish to nor will I contribute so that others may have the same opportunity. Naturally we will have those anti-Americans on the lunatic fringe of the right who will claim, it's free enterprise as a concept as fundamental as social responsibility and civilization simply glides by in their self centered little world. There seems to be very little that some folks won't support in the name of I get to keep everything. Perhaps the rest of us should start pressing for fees on every single thing that civilization supplies. It seems impossible such greed could exist in some but we have been implanting this "it's all about me and mine" for the last 40 years so what should we expect. Greed and narcissism exactly what we ended up with.
Speaking out against unpatriotic, unscrupulous tax dodgers elicits a comparison to East Germany. Interesting!
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While I find Saverin's behavior repugnant, it's a slippery slope when governments start charging entrance or exit fees to a country. Even right now, some countries such as New Zealand score potential immigrants higher points if they can bring so much $$$ or Euros with them, and now here in the US we want to charge exit fees. I fully understand how obnoxious this guy's behavior is, and why people would want to correct it, but think for a minute where this is going if we grant government this power.
Maybe they'll do the same for Mexican-American Romney!
ABSOLUTELY! Deny him re-entry FOREVER! Do you think either Zuckerberg or this guy cares about the U.S.? I am sure that investors saw this story and it hurt the IPO to some extent. Facebooks IPO did not go as planned by these money grubbing punks. Sure they have the money but we have the vote to start cracking down on all these Wall Street Journal types. IT IS HIGH TIME WE START ELECTING FOLKS LIKE LIZ WARREN TO GO AFTER THEM.
Remember, what goes around comes around. Saverin has struck his Faustian bargain. One day, though, he may find himself dearly wishing he had retained his citizenship.
Whatever his taxes amount to, he will still be a billionaire. He's excessively greedy, selfish, and anti-patriotic. He's among many bad examples in the business world of what a human being should be in a civilized society. To those who claim he's doing nothing illegal, we shall see. In any case, what's legal is not necessarily moral, right or acceptable. If we all pushed the limits of what was legal, our lives would become unbearable.
Isn't the current capital gains rate only 15%? So this guy is jumping ship for what most of us already consider to be a low tax rate? Definitely lower than what most people's effective tax rate is. If keeping 85% of a lot of money isn't enough then bye-bye and take his passport away and don't let him back in. I hope he gets caught spitting in Singapore and gets a good caning. Unpatriotic, selfish jerk.
The funny part is that these Silicon Valley frauds pay very little in corporate taxes and are moving overseas and out of state because of cheap labor and taxes. I could go on about the greedy VC pigs on Sand Hill road. Yet, the far left has no clue what real power these folks have and they waste there time demonizing Wall Street.
In 2011, over 1500 individuals renounced their American citizenship. Several years ago,I worked with several engineers with foreign citizenship that entered the US on H1B visas to work on DoD programs. I was told by them that they did not pay US income taxes or payroll taxes under Sec 411 of the IRS tax code.
Or you could, you know, just cut taxes.