June 27, 2008
The Hartford Courant on Taxing Expatriates
"New Law Cracks Down On Rich Tax Evaders"
By Kathy Kristof
You may not like paying federal taxes, but chances are you're not going to renounce your U.S. citizenship to get out of the obligation.
That's probably wise, especially because a tax bill that was signed into law last week contains a provision designed to crack down on the roughly 500 rich people who expatriate themselves each year to avoid U.S. income and estate taxes.
Although the number of people who take that path might be small, the government has been enacting increasingly strong measures to stop the practice during the past dozen years. For that, you can thank billionaire and ex-Floridian Kenneth Dart, said Bill Ahern, a spokesman for the Tax Foundation, a nonpartisan research group based in Washington.
Dart is one of the heirs to a multibillion-dollar Styrofoam-cup manufacturing business based in Sarasota, Fla. In 1994, he renounced his citizenship and moved to Belize, a small Central American country known as a tax haven.
Belize promptly sought U.S. permission to open a consulate in Sarasota with Dart as its consul. Foreign diplomats are exempt from U.S. taxes, so the move would have allowed Dart to avoid U.S. taxes while continuing to live here.
The plan earned a "chutzpah" award from the late humorist Art Buchwald, but it was rejected by the State Department, which said Belize already was well represented in Florida with a consulate in Miami.
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