Friday, February 10, 2017

New High In Citizens Renouncing US Citizenship: Upward Trend Since Foreign Account Tax Compliance Act (FACTA) Passage

From Bloomberg, "Americans Renouncing Citizenship at Record High: It all goes back to the Civil War" by Suzanne Woolley:
The number of Americans renouncing their citizenship rose to a new record of 5,411 last year, up 26 percent from 2015, according to the latest government data.
The rules got trickier in 2010, when, in an effort to cut down on tax evasion, the Foreign Account Tax Compliance Act (fabulously, Fatca, for short) was passed into law. It basically said foreign institutions holding assets for U.S. citizens had to report the accounts or withhold a 30 percent tax on them if the information wasn't provided. That led some foreign banks to shy away from opening accounts for expats.

Since Fatca came into being, annual totals for Americans renouncing citizenship have reached their four highest historic levels, as shown in the chart below from Andrew Mitchel LLC and its International Tax Blog.

Yearly Totals Of US Citizens Renouncing Citizenship
Source: Bloomberg

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