The overall fiscal burden in the United States may be lower than it is in Europe, but there are some features of the internal revenue code that are far worse than what can be found on the other side of the Atlantic. America has a “worldwide” tax system, for instance, which means that our government interferes with the sovereignty of other nations by taxing income earned by Americans inside their borders. Good tax policy, by contrast, relies on the “territorial” principle of only taxing income earned inside national borders – and every other developed nation uses this system. Not surprisingly, both the flat tax and national sales tax are based on this common-sense approach. If an American earns income in Hong Kong, it should be up to Hong Kong to decide how that money gets taxed. Likewise, if a German earns money in the United States, then he is fair game for the IRS. There’s an old saying that good fences make good neighbors, and territorial taxation is the fiscal policy equivalent of this sound rule. Not surprisingly, however, other nations want to mimic this horrible feature of the American tax code. The Financial Times is even urging European nations to jointly make that misguided choice. Fortunately, it is almost certain that some nations will refuse to join in such a statist cartel:
The US is unique in using citizenship in determining whether a person’s worldwide income is subject to taxation. Most countries do not impose tax on their citizens who are not resident within their borders – apart from any income that is sourced in that country. But the US system has much to commend it. After all, any citizen of a country enjoys the implicit legal and physical protection it affords. …provision is made to avoid double taxation. Moreover, there is an exit for individuals who do not accept it as they can renounce their citizenship and move elsewhere. But perhaps the best thing about it is that a worldwide system linked to citizenship is simple and easy to understand. Most American citizens do accept it, although more have handed back their passports recently. It would be hard for, say, the UK or Germany to introduce such a system unilaterally. There would be the risk of citizens jurisdiction-hopping by swapping one passport for another within a common economic area. But all European Union states could introduce the same rule. That would not be impossible. After all, EU countries already co-ordinate their policies on savings taxes and their tax authorities exchange information.
[…] reports that the number of Americans giving up their citizenship to protect their families from America’s onerous worldwide tax system has jumped rapidly. Even relatively high-tax nations such as the United Kingdom are attractive […]
[…] P.P.S. But that may not last too long. Other nations are looking to copy America’s disgraceful worldwide tax approach. […]
[…] Americans have to do more than simply move since the United States has the worst worldwide tax system of all nations. To escape the greedy and grasping claws of the IRS, they have to disengage with the U.S. […]
[…] specifically, he wants to move away from the current system of “worldwide” taxation and instead shift to “territorial” taxation, which is simply the common-sense notion of […]
[…] France, like almost every other civilized nation, does not have worldwide taxation. So when French citizens move to Switzerland, Hong Kong, or the […]
[…] France, like almost every other civilized nation, does not have worldwide taxation. So when French citizens move to Switzerland, Hong Kong, or the […]
[…] folks are livid with the tax system, thanks to awful policies such as America’s worldwide tax regime and punitive laws such as […]
[…] the other hand, if the government forces companies to overstate their income with policies such as worldwide taxation and depreciation, then the statutory tax rate understates the actual tax […]
[…] the other hand, if the government forces companies to overstate their income with policies such as worldwide taxation and depreciation, then the statutory tax rate understates the actual tax […]
[…] the other hand, if the government forces companies to overstate their income with policies such as worldwide taxation and depreciation, then the statutory tax rate understates the actual tax […]
[…] the other hand, if the government forces companies to overstate their income with policies such as worldwide taxation and depreciation, then the statutory tax rate understates the actual tax […]
[…] the other hand, if the government forces companies to overstate their income with policies such as worldwide taxation and depreciation, then the statutory tax rate understates the actual tax […]
[…] country without the U.S. federal government breathing down their necks. The United States has a worldwide tax system which means that a U.S. citizen living outside of the United States cannot legally escape the wrath […]
[…] United States has a “worldwide” tax system, which necessitates a form of fiscal imperialism. And because America is the 800-pound gorilla of […]
[…] United States has a “worldwide” tax system, which necessitates a form of fiscal imperialism. And since The united states is the 800-pound […]
[…] United States has a “worldwide” tax system, which necessitates a form of fiscal imperialism. And because America is the 800-pound gorilla of […]
[…] to expropriate and redistribute. While I’m obviously not a big fan of British fiscal policy, America is worse in one important way. At least British taxpayers have the liberty to leave without being raped by the U.K. tax […]
[…] expropriate and redistribute. While I’m obviously not a big fan of British fiscal policy, America is worse in one important way. At least British taxpayers have the liberty to leave without being raped by the U.K. tax […]
[…] reports that the number of Americans giving up their citizenship to protect their families from America’s onerous worldwide tax system has jumped rapidly. Even relatively high-tax nations such as the United Kingdom are attractive […]
Well, if their rich then shouldn’t they be able to afford to pay taxes? Then again if you had to pay our taxes along with another countries that could end up more expensive.
[…] reports that the number of Americans giving up their citizenship to protect their families from America’s onerous worldwide tax system has jumped rapidly. Even relatively high-tax nations such as the United Kingdom are attractive […]
[…] reports that the number of Americans giving up their citizenship to protect their families from America’s onerous worldwide tax system has jumped rapidly. Even relatively high-tax nations such as the United Kingdom are attractive […]
[…] reports that the number of Americans giving up their citizenship to protect their families from America’s onerous worldwide tax system has jumped rapidly. Even relatively high-tax nations such as the United Kingdom are attractive […]
[…] reports that the number of Americans giving up their citizenship to protect their families from America’s onerous worldwide tax system has jumped rapidly. Even relatively high-tax nations such as the United Kingdom are attractive […]
[…] reports that the number of Americans giving up their citizenship to protect their families from America’s onerous worldwide tax system has jumped rapidly. Even relatively high-tax nations such as the United Kingdom are attractive […]
[…] one place to another. The Financial Times recently urged that all European Union nations agree to impose American-style worldwide taxation rules on their citizens. What should happen, by contrast, is that the United States should copy Europe (in this limited […]
This is so stupid and just goes to show me again how greedy and jerks are the pol,s here in the US.