Chuck Schumer, (D -NY), and Bob Casey, (D-Pa) are unveiling a new tax scheme, the “Ex-PATRIOT Act” or Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy Act. But before Republicans roll their eyes and hammer their fists in anger, they would do well to take a moment and reflect at what a golden opportunity this “tax hike” could be for Republicans and how it could actually reduce the tax burden if Republicans are smart enough to use the Dems tax scheme to a new advantage. How would they do that?
The Ex-Pat Act is in direct response to those Americans who have renounced their American citizenship, specifically to keep from having to pay the exorbitant taxes Americans are forced to pay under our draconian tax system. The Act would impose a 30% tax “on the capital gains of anybody who renounces their U.S. citizenship.” The reason why Schumer, and other Dems, are proposing this, new tax, besides the obvious reason – their Democrats, and Democrats never met a tax hike they didn’t like – is to make certain that people who do renounce their American citizenship, like Facebook co-founder Eduardo Saverin, who did renounce his American citizenship before taking Facebook public, would still be required to pay the tens of millions in taxes on his stock purchases he would otherwise owe as an American citizen, some 67 million dollars.
But – why should Republicans go along with this scheme, and how can Republicans use it to their advantage, and to ultimately reduce the tax burden?
Before Republicans throw the Ex-Pat Act into the Boston Harbor, they ought to sit down with Democrats and make a deal that would benefit all Americans and American business; and, while it would impose a hefty fine on American tax “traitors” (which we ought not be too concerned with, yet) the benefits of this tax could have dramatic implications if Republicans play their cards right. But, of course, if Democrats balk, or refuse to compromise, then by all means we ought to support, with a certain amount of understanding and sympathy, those Americans entrepreneurs and business risk takers that flee American and America’s outrageous and crippling tax system.
Behind those proverbial “closed” doors” Republicans ought to demand, in exchange for going along with the Ex-Pat Act, that both capital gains and corporate taxes be put in limbo (a moratorium) for a period of five years, after which both those taxes would come back at a competitive 9%, respectively. Ideally both those taxes would be abolished all together, along with a host of other non-essential taxes (of which most taxes are). However, until Republicans control all three Houses, and in particular, fiscal conservative Republicans who are determined to shrink the size of government, that is unlikely to occur. But we can get the ball moving in the right direction.
One of the most important things we can accomplish in regaining control of our economy, and growing that economy, and in creating a plethora of new jobs, and new tax revenue, is to reduce the risk involved in owning and operating a business, investing in that business and profiting from that business. It makes absolutely no common sense, or smart business sense, to have among the highest corporate and capital gains taxes in the world. The more we can reduce these taxes, make them more competitive, more attractive for American businesses who have already fled to other nations to return to America, and even for foreign business to relocate to America, the more we can reverse our stagnant economy, which is, in essence in a coma and on life support right now.
Obviously there are other business taxes associated, and we will need to deal with those too, as well as the entire tax system. But if we can do this one thing, put that five-year moratorium on capital gains and corporate taxes, in that five-year period we will see our economy rebound and grow with dramatic results. New businesses will be created; current businesses will expand; all of which will need new workers to meet demands. Millions of real jobs, with competitive wages and salaries will be created, putting millions of Americans back to work, and dropping to unemployment rate well below 5%.
We know exactly what Schumer and the Democrats are up to with their Ex-Pat Act, but before we pooh-pooh it, let’s use it to our advantage for real and meaningful tax change in our country. Of course, the Democrats might just walk away from the table and scrap their tax scheme altogether. That is a possibility.
Republicans are in a good position to retain the House, pick up more seats in the Senate (if not take that too) and Romney is looking pretty good in the polls right now against Obama. This may be the Democrats one and only opportunity to increase taxes before the election, and, if Romney’s wins, the last opportunity for a very long time. Would Schumer and the Democrat Party risk blowing such an opportunity? Just how badly do they want to “sock it to ‘em” – those Americans who renounce their citizenship in order to avoid, and to evade paying taxes? Are we willing to find that out, or will we arrogantly squander a precious opportunity to cut taxes?
- Eduardo Saverin doesn’t owe us anything (humanevents.com)
- ‘Truth, justice, and the American Governments GREED For MONEY (whoopsies.wordpress.com)
- Escape from America: Why our most prolific taxpayers are getting out of Dodge! (ConservativeActionAlerts.com)
- Boehner: Sure, I might support Schumer’s bill to tax Eduardo Saverin’s wealth (Hotair.com)
- Boehner Piles On FB Founder (yeagercpa.wordpress.com)
- Democratic Senators Unleash Tax Vendetta Against Eduardo Saverin (outsidethebeltway.com)