Proud to be American?

A friend of mine posted a really interesting article on Facebook from the NY Times.  Apparently there are a growing number of Americans expats who are renouncing their US citizenship. The most common reasons stated are double taxation and banking problems.

Now I find all of this very interesting.  Firstly I thought that you couldn't renounce your US citizenship for tax reasons alone.  I thought that you had to have a greater reason like a political or moral objection to something the US has done.  Also I found it very interesting that someone would just give up their US citizenship because they have to pay double taxes.  As someone making less than $91,000 a year, I can exclude my entire income and therefore don't feel the brunt of being taxed twice.  But I wonder if I was in such a position, is that enough reason to give up one's citizenship?

I would be completely frustrated if my US bank account was closed due to some crap Patriot Act provision.  I like many others have saving that I still have in the US along with some debts (student loans) that I'm still paying off.  Without my US bank accounts, I'm not sure how I'd still make those payments.

Again, I don't think that either of these reason are enough to renounce up my US citizenship. While I don't see myself returning the the US anytime soon, I do like having the option.  My mother never gave up her British citizenship which allowed me to come to London on a whim and live with no problems.  I would like to give my own children the same opportunity if they so desire.

It seems to me that the greater issue is that there is little consideration put in US finance law for people living abroad.  Taking the double taxation for example, if one is not using any public resources (roads, schools. etc) because they are out of the country, they why do they owe the state or the federal government taxes?  Out of all of the industrialized nations, the US is the only where its citizens can pay double tax.  I know that the reasoning behind the law is so that people don't run off to a country that has a really low tax rate.  But how many people are really hopping a plane to go to these countries?  If there has been a mass exodus, I've yet to hear about it.

There also has to be a better way of handling the banking situation.  Although the government acknowledges that there is “nothing in U.S. financial law and regulation should make it impossible for Americans living abroad to access financial services here in the United States”, they still haven't done anything to stop banks from closing expat accounts.  Acknowledging the problem is the first step, but now they must act to stop this practice.  There are estimated to be 4 million Americans living abroad.  This means that there are 4 millions absentee voters whose bank accounts can potentially be closed in error.  So why isn't there some sort of legislation to address this?

If these issues were addressed by some sort of legislation, then perhaps people would not feel pushed to the point of wanting to or of actually renouncing their US citizenship.  Its personally not something that I would do.  But I can understand the frustration.