Boris Johnson, best known as the Mayor of London, is no longer an American. It wasn’t his idea to be one in the first place, but he was born in New York, so the decision to formally de-Americanize himself cost him $2,350 in fees payable to the State Department for the renunciation of his US citizenship. This was on top of the capital gains tax that the IRS demanded, and received at least in part in a settlement, for the sale of Johnson’s primary residence in London.
This is what US citizenship means to dual citizens living abroad over the long term: harassment across oceans by the long arm of the American law for tax purposes. That’s it. People who have never resided in the United States as adults and spent little or no time there on business or vacation find menacing IRS notices in their mailboxes, demanding tax payments on income that they earned and already paid taxes on in their home countries, for no other reason than they happen to have been born in the United States. These people are not Americans in any meaningful sense, have practically nothing to do with the United States, and do not receive services from the US federal government or any state or local government, but none of this matters; the Internal Revenue Service is no less eager to reach into their lives across international borders and shake them down.
There’s no excuse for this. Few of these people use US consular services for any purpose other than attempting to renounce US citizenship, since they’re dual citizens with access to the consular services of their home governments, but even if they were, this would be a bogus reason to menace them for tax payments. Consular services make up a tiny portion of the US federal government’s operating costs. They’re paid for many times over by Americans who will never have any use for them in the course of routine payroll remittances to the IRS. Besides, any time one of these foreigners with accidental US citizenship visits the United States, he pays for well more than the equivalent of his share of US consular services in the form of sales taxes and airport facility fees. If the federal government feels shortchanged by this arrangement, it can work out some kind of reapportionment with the baroque assortment of state and local governments that it has encouraged to proliferate over the past 239 years.
There’s no excuse for jacking up citizenship renuniciation fees, either. The total cost for the expedited renewal of an adult US passport book and passport card is only $200. This is what I paid in July for new passports that were delivered within about two weeks of the time I mailed the application. Until last year, the cost to renounce citizenship before a US consular officer was $450, or two and a half times the cost of expedited passport book and card renewal. Now it’s over eleven times as expensive.
This isn’t fee assessment to cover expenses; it’s extortion. Most people renouncing US citizenship today are doing so because they have minimal ties to the United States and are getting nothing from their dual nationality except harassment by the tax authorities of a country where they don’t live. Historically, rather few of the people renouncing citizenship in any more or less free country do so because they’re traitors or fruitcakes in the mold of Kim Philby. This is especially true today. Renunciations of US citizenship have more than tripled since the passage of the Foreign Account Tax Compliance Act of 2010, or FACTA, which strong-armed foreign banks into submitting to the meddlesome intrusion of the IRS into accounts held by US citizens. Theoretically, FACTA is meant to keep extremely wealthy Americans from using storefront shell companies in countries like Switzerland, Luxembourg, and the Dutch Antilles or making bogus foreign residency declarations in order to shelter income that was effectively made in the United States from US taxation. In practice, it results in the tax gouging of people who haven’t lived in the United States since early childhood, i.e., foreigners, and expatriates trying to get by on modest salaries or pensions.
This wretched extortion is being done by the same government that can’t find the courage to call bullshit on American multinational corporations that formally incorporate themselves at minor offices abroad where they do no real business in order to shield their US earnings from US taxation. Boris Johnson is an American when he profitably sells real estate in England, but if ExxonMobil or Microsoft decides to sell some stock to major foreign investors, rent a mailbox in a Rotterdam industrial park, and tell the IRS, “Fuck you, bitch, we’re Dutch now,” that’s all cool.
Universal taxation doesn’t really have anything to do with the sovereignty of the US government, either. The IRS is one of the most lawless and widely hated federal agencies in the United States. It treats most taxpayers fairly well, but those it chooses to mistreat, sometimes for political reasons, have horror stories that are numerous enough and bad enough to scare and infuriate the rest of the country. There’s a popular mandate for the IRS’s collection of duly assessed federal taxes, but not for its harassment of individual taxpayers at will because some auditor has a vendetta or a paranoid hunch or is pursuing a vendetta on behalf of politicians or deep state shitlords behind the curtain. There certainly is no mandate for the IRS to harass expatriates who pay taxes in their countries of residence or foreigners who only incidentally retain US citizenship as an accident of birth in the United States or to American parents. IRS fishing expeditions against individuals living abroad with few or no ties to the United States is nothing more than freelance banditry under color of authority.
The number of disaffected Canadians who are sick of their nonreciprocal obligations to the IRS has gotten so large that wait times for renunciation appointments with US consular officers have reached as much as four months. This is in spite of all the extra revenue that the State Department is realizing from its more than fivefold increase in renunciation fees at a time with increasing numbers of renunciations. State can’t be bothered to send adequate consular staff to Canada, although it has no trouble finding the resources to seize and hold the US passports of Yemeni-Americans who seek routine consular assistance while visiting Yemen, rendering them effectively stateless or close to it.
Yes, do tell Mr. Wonka about this self-government arrangement that we have as Americans. He’ll be fascinated.