Lawmakers Target Tax Avoiders
On the same day Facebook completed one of the largest IPOs in U.S. history, some prominent American lawmakers announced legislation targeting the co-founder of the social media giant. Senators Charles Schumer (D-NY) and Bob Casey (D-PA) are proposing the "Ex-Patriot Act," aimed at those who renounce their U.S. Citizenship in order to avoid taxes. The proposal comes after reports that Facebook co-founder Eduardo Saverin renounced his American citizenship last year ahead of the company's IPO. Schumer calls that move a "scheme" that "would allow him to duck up to $67 million in taxes."
The "Ex-Patriot Act" would impose mandatory taxes on expatriates after they flee the U.S. and bar them from ever reentering America. But KTRH's Money Man Pat Shinn says it's "much ado about nothing. It's all about politicians getting in front of the camera." Shinn points out the U.S. already has expatriate laws on the books similar to this one, and only about 1,700 people renounced their U.S. citizenship last year anyway.
Shinn argues that if the government is serious about going after uncollected tax dollars in foreign countries, it should eye corporations. "About half of the cash held by U.S. corporations is currently held overseas." That's why focusing on those like Saverin is akin to "chasing pennies, nickels and dimes while we're letting the big dollars go out the back window."