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Eduardo Saverin came to the United States as a boy because his name had been on a list of potential targets by kidnappers in his native Brazil. The ransom that he evaded paying to lawbreakers in Brazil has been demanded by lawmakers in America. Saverin and his money have again evaded capture. The tech billionaire and his billions are safe in Singapore.
Eduardo Saverin, a co-founder of Facebook, has renounced his U.S. citizenship in anticipation of the company’s initial public offering today. Media savvy Senator Chuck Schumer, in anticipation of that same initial public offering, has introduced a bill, along with Pennsylvania Senator Bob Casey, to tax people who renounce their citizenship to escape taxes. The bill seeks to financially punish expatriates, impose a 30 percent capital gains levy upon them, and ban them from reentering the country.
When Uncle Sam can’t play Big Brother he throws a Little Brother brat-fit. What does it say about a politician who supports rewarding with citizenship immigrants who enter the country illegally but seeks to ban one of America’s most productive immigrants from ever stepping foot in the United States for the crime of legally leaving? Hell hath no fury like a tax man scorned.
Eduardo Saverin and Chuck Schumer share an alma mater but little else. Harvard graduate Saverin has never worked in government. Harvard graduate Schumer has never worked outside government. Saverin speaks entrepreneur. Schumer speaks politician. Their words can’t help but get lost in translation.
“I’m not a tax expert,” Saverin said in Wednesday’s New York Times. “We complied with all the known laws. There was an exit tax.” For the New York senator, the exit tax wasn’t taxing enough. “This is a great American success story gone horribly wrong,” Schumer told reporters Thursday. “This tax-avoidance scheme is outrageous. Eduardo Saverin wants to ‘defriend’ the United States of America just to avoid taxes. We aren’t going to let him get away with it.” The legislation’s gimmicky name—the Ex-PATRIOT Act, which stands for Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy—employs the last refuge of a scoundrel against IRS refugees.
But the price of patriotism for Saverin was $67 million. That’s the amount Schumer estimates the expat will save by switching his citizenship from the United States to Singapore. Given that Singapore not only boasts freedom from the capital gains tax but also abolished its estate tax in 2008, the senator probably underestimates the entrepreneurs’ savings.
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