Readers in the Sacramento area may have seen reports regarding the tax issues surrounding Eduardo Saverin. Saverin is a co-founder of social media powerhouse Facebook, and the tax controversy stems from his renouncing his U.S. citizenship shortly before Facebook’s billion-dollar IPO was released. Though Saverin denies the allegations, many people have said that he renounced his citizenship in order to reduce his tax liability.
Many U.S. citizens, including some politicians, believe that without Saverin’s U.S. citizenship and the opportunities he had while living here, he would not have made his fortune, which is said to be in the billions. In light of the controversy, both the Democrat and Republican parties are weighing in and expressing their opinions on the case. Some people are furious while others view Saverin as a hero.
Democrats have introduced legislation called the Ex-PATRIOT Act — or, the Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy Act — which could bar people such as Saverin from re-entering the U.S. later, as well as force them to pay an increased tax rate on any U.S. assets. Republicans appear more divided in their support and have found themselves in a precarious decision-making position. Overall, conservatives defend Saverin’s decision to renounce his citizenship and have instead criticized the tax code.
While most taxpayers in California may not have to be concerned with billions of dollars in taxable income, the predicament of Eduardo Saverin warrants the watchful eye of all taxpayers. Skeptics warn that the Ex-PATRIOT Act may be designed strictly for the purpose of punishing Saverin in an attempt to create an ex post facto law. But if the Ex-PATRIOT Act is passed, it may have implications for more than just one taxpayer who is involved in international business.
Source: The Maddow Blog, “Eduardo Saverin’s ideological allies,” Steve Benen, May 18, 2012