The anti-Startup Visa movement in Washington DC
More people are giving up their green cards and U.S. citizenship, says the Wall Street Journal.
Two consultations in the last week from prospective clients on this very topic already.
Good business for our firm. Bad, bad, bad for the United States.
Most of the people who are thinking of this are highly productive people — entrepeneurs, people with Ph.Ds, company-builders.
I’ll be in Saudi Arabia in two weeks. On the topic list for discussion there — what to do about Saudi kids who were born in the U.S. (hence are U.S. citizens) and are approaching age 18. (At age 18 they have an easy and tax-free way to give up citizenship. I’m generally encouraging people to jump on that opportunity.)
Memo to Congress
Here’s a really useful question to ask yourself, honestly, inside your own head, when you’re contemplating a new law: ”And then what will happen?“
- Static models of reality fail as soon as they include human beings and time.
- The hidden cost of what you can’t see (smart people no longer coming to the United States to go to school, start businesses, create technology, jobs, and launch new industries) dwarfs what you think you will get (tax revenues on the exit tax).
Startup Visa in reverse
Dave McClure and others are pushing for a startup visa — give nonresidents a visa to enter the United States and start a new venture.
The exit tax — and increasing evidence that entrepeneurs are fleeing the United States or choosing not to come here in the first place — is the anti-startup visa. It’s like trying to fill the bathtub with water while keeping the drain open.
I wish Dave and his crew success in their efforts. Unfortunately, they are asking Congress to be perceptive and forward-thinking, and that is unlikely.
The only tracking I’m aware of that covers renunciations and surrender of green cards is the Federal Register, and that only picks up “high net worth” individuals.
My guess is that this article is somewhat superficial and, consequently, misleading, then, since presumably Federal Register figures are what they quote. While HNW individuals are of course more motivated than others to renounce/surrender, one could reasonably expect that there has also been a corresponding uptick in non-HNW renunciations and surrenders, in particular amongst people on the verge of but not yet covered by the anti-expat tax laws.
The great unmeasurable, as you note, is how many potential high-flyers not currently in the US will simply avoid green cards and bypass the US altogether, selecting instead from other more welcoming host nations. To a potential immigrant entrepreneur, the combination of FATCA, the FBAR, the exit tax, the US estate tax for non-citizens, and the lack of a vote or any mechanism to change any of this in a meaningful way makes the US appear very unappealing indeed.