Number of Americans renouncing their citizenship, 1998-2016

FATCA’s dragnet tax compliance has high costs

  • The U.S. forces its citizens living abroad to file and pay taxes to the IRS
  • The costs for citizens to comply are high and the whole exercise brings the U.S. little benefit
  • In the long run, the policy could damage the American economy

The worldwide structure of the United States’ personal income tax and congressional efforts to enforce it have caused hardship for U.S. expatriates, and it is likely to get worse before it gets better.

Before the 2017 tax reform, the U.S. was one of only six member countries of the Organisation for Economic Co-operation and Development (OECD) that still attempted to tax the foreign-earned income of U.S.-headquartered businesses and citizens. Tax reform began to fix this problem for businesses, by moving toward a “territorial” system that does not claim full taxing rights to business income earned overseas. Foreign resident U.S. citizens, however, were entirely left out of these reforms. Everyday citizens will bear the brunt of the economic and social costs from the increasingly burdensome international financial tax systems.

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 Adam Michel
Many foreign banks no longer provide financial services of any type to American citizens
read more about it in the report
What's inside
  • The U.S. forces its citizens living abroad to file and pay taxes to the IRS
  • The costs for citizens to comply are high and the whole exercise brings the U.S. little benefit
  • In the long run, the policy could damage the American economy
Who will benefit?
  • Report is targeted to the decision makers in cross country manufacturing – suppliers, manufacturers, logistics.
  • Also considered useful for the administrative university facilities, to better understand the possibe effects of current decisions.
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