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It seemed to me that a large part of their argument was that foreigners were required to pay inheritance tax on the value of all US assets, even though they wer

It seemed to me that a large part of their argument was that foreigners were required to pay inheritance tax on the value of all US assets, even though they weren't us citizens. That doesn't really seem fair to me.

ajross 17y ago
Why? The US Government taxes activity within its borders. It's not different than foreigners paying sales tax on stuff bought in the US. Now, I know next to nothing about international inheritance and estate tax policy, but I'd have to assume many, many other nations have identical policies, no?
- CWuestefeld 17y ago
  No, the problem is that the US government taxes activity by its citizens (and even ex-pats) outside of its borders, and is fairly unique in doing so. It seems clear to me that someone who isn't deriving any benefit from the "protections" of the US government shouldn't be required to pay for those protections. Otherwise, it really is just a protection racket.
  - jhancock 17y ago
    As a U.S. citizens living in China for many years, I still consider the U.S. my home long term. I receive a reasonable tax deduction for living out of the country the majority of each year, and that is a fair tradeoff. The U.S., my home, still needs to survive and invest in its future. Taxes are the critical element for this. So when you say "protections". Well, if I'm not living in the U.S. "right now" I'm not right now receiving protections, right? Not really. I am. I can go home anytime I want if things get too tough for me in China. I have the safety of knowing their are local police and fire departments in my home town protecting my house, for example, the things that non-citizens don't want to pay taxes to help support. Even if I were living in the U.S. right now, I wouldn't be pulling money from Social Security or other forms of aid. But the "protections" are their whether I'm currently using them or not.
    - borism 17y ago
      "I have the safety of knowing their are local police and fire departments in my home town protecting my house, for example, the things that non-citizens don't want to pay taxes to help support." I don't get it. Why would non-citizens not want to pay for police and fire-trucks? Don't you pay for those essential services in China, or if you do, do you consider those an unnecessary burden there?
      - jhancock 17y ago
        If you own a home, even as an investment as a foreigner, you want to make sure it doesn't get burned down or broken into. This costs, and taxes are used to pay those costs. What will happen to the value of your home if the local water, sewage, roads, schools are not maintained? Even if your child odes not go to school in that district, a high quality school adds significant value to your home price. In China, I pay taxes on my home, and the gov is expected to use some of this money to protect my home there. I'm not being double taxed, I have two homes and pay for each in their respective countries.
        CWuestefeld 17y ago
        I think you're overlooking the key part of my point. I'm saying that the person has no home in the USA, no nothing. But the USA still taxes income made overseas. Heck, even if this hypothetical person renounces his citizenship, they continue to take the taxes for another ten years!
        jhancock 17y ago
        The reason they are expected to pay is because they made a choice to come to the U.S. and become a part of that society. If you don't want those implications, don't make that choice. The reason people make the choice is because they want the benefits they may get from coming to the U.S. I realize it is too hard for many that come to the U.S. to become citizens; we need to fix that problem. Our immigration strategies are not clear and makes immigrants pay on both ends of the deal. But really, if you want to come to the U.S., suck out some wealth, and then say "so long", well, you'll get what's coming to you.
  - krschultz 17y ago
    But the things they mentioned, US Treasuries, stock in US companies ARE benefiting from the US gov't protection. Its not like they are taxing Swiss citizens on Swiss stocks traded on Swiss stock exchanges. They may be fairly unique in doing so, but the US is a fairly unique country in terms of percentage of the global economy. Other countries may have no tax in order to entice more investment, the US does not have to do that. If you don't want to pay the taxes, don't invest in the US economy.
    - CWuestefeld 17y ago
      That may be what the OP mentioned, but it's only part of the picture. If I'm an ex-pat, and make my money as (say) a laborer in another country, my income on that labor will be taxed by the US government. What right do they have to it? the things they mentioned, US Treasuries, stock in US companies ARE benefiting from the US gov't protection The companies that our hypothetical expat owns the stock in already paid corporate income taxes for their own protection. Why should he pay again for it? Really, the questions here are * Should the US government be able to dictate the laws of foreign lands, in order to satisfy its own choice of tax regime? * Should the US government be able to dictate that foreign corporations provide data to the US, forcing those foreign corporations to bear the costs for enforcing the American tax regime?
      - jhancock 17y ago
        * Should the US government be able to dictate the laws of foreign lands, in order to satisfy its own choice of tax regime? No they should not. But this is not what's happening here. The transactions originated in the U.S. by and through U.S. entities. * Should the US government be able to dictate that foreign corporations provide data to the US, forcing those foreign corporations to bear the costs for enforcing the American tax regime? Again, that's not what's happening here. When UBS or any other foreign bank operates in the U.S., it is incorporated as a U.S. entity and must follow U.S. laws. UBS and such have chose to say "oh, those customers we acquired in the U.S., well, that data is back in Switzerland, and we have strict privacy laws there, so no can do". Sorry, but the transactions originated in the U.S. through the U.S. operating entity, Swiss laws have no say here. These banks have gotten off incredibly light. The U.S. has plenty of existing laws on the books to allow them to seize the assets of the entire bank for their illegal behavior. The only reason they did not is because seizing Swiss banks would have unknowable repercussions from global elite.
jhancock 17y ago
Even if their argument was _only_ that one tax issue, its still a legitimate U.S. tax. Allowing non-U.S. citizens to participate in transaction without taxation of U.S. property, yes, private property, amounts to forcing U.S. citizens to carry a larger part of the tax burden. However, this is just their stated issue. The real reasons are much larger than this one taxable interest. If Swiss citizens (or any other doing biz with this "neutral" country) don't want to pay U.S. taxes, they can buy and sell property in Switzerland or some other country that doesn't mind its citizens carrying the tax burden for non-citizens.
- joubert 17y ago
  How about temporary workers (e.g. 2 year work stint in a bank, etc.) in the US having to pay social security and medicare taxes during that time; a tax for a future benefit that they will never see. I always thought that was super unfair.
  - jhancock 17y ago
    That one does seem unfair. To get to the bottom of your issue, you have to figure out how to deal with the case of what if you later choose to become a permanent resident/citizen? Would we need to collect a large sum of back taxes on you? Are you certain you get no benefits as a temporary worker? I am looking into getting my wife non-permanent-residency in the U.S. One part of this is me proving, through prior tax filings, that I live well above the poverty level for a family of 3. The reason for this is once she is here, she can file for welfare and such. So apparently, a new resident, even non-permanent does have some social benefits: welfare, emergency health care, etc. The tax structure is complex, uneven, and government spending is not well controlled. I feel that if we fix issues like we are trying to do with offshore banking, we can get to the next part, which is determining more fair taxation. So long as there are ways out for some, there is not enough force to fix tax fairness issues.
  - bluedanieru 17y ago
    Many countries have agreements where if you pay into a national pension in one, it will count as having contributed to the other should you ever return. For example in Japan where I pay into the national pension plan, most of that could be counted for Social Security if I moved back to the States (or, I could opt for a single payment immediately).
run4yourlives 17y ago
US Tax code is the most unfair set of laws I've ever seen to be honest. Most countries wouldn't even dream of demanding the levels of indentured servitude that the IRS feels is their right to collect. In fact, I'd say the only state that is worse at screwing foreigners is - surprise - Switzerland.

ajross 17y ago

Why? The US Government taxes activity within its borders. It's not different than foreigners paying sales tax on stuff bought in the US. Now, I know next to nothing about international inheritance and estate tax policy, but I'd have to assume many, many other nations have identical policies, no?

CWuestefeld 17y ago
No, the problem is that the US government taxes activity by its citizens (and even ex-pats) outside of its borders, and is fairly unique in doing so. It seems clear to me that someone who isn't deriving any benefit from the "protections" of the US government shouldn't be required to pay for those protections. Otherwise, it really is just a protection racket.
- jhancock 17y ago
  As a U.S. citizens living in China for many years, I still consider the U.S. my home long term. I receive a reasonable tax deduction for living out of the country the majority of each year, and that is a fair tradeoff. The U.S., my home, still needs to survive and invest in its future. Taxes are the critical element for this. So when you say "protections". Well, if I'm not living in the U.S. "right now" I'm not right now receiving protections, right? Not really. I am. I can go home anytime I want if things get too tough for me in China. I have the safety of knowing their are local police and fire departments in my home town protecting my house, for example, the things that non-citizens don't want to pay taxes to help support. Even if I were living in the U.S. right now, I wouldn't be pulling money from Social Security or other forms of aid. But the "protections" are their whether I'm currently using them or not.
  - borism 17y ago
    "I have the safety of knowing their are local police and fire departments in my home town protecting my house, for example, the things that non-citizens don't want to pay taxes to help support." I don't get it. Why would non-citizens not want to pay for police and fire-trucks? Don't you pay for those essential services in China, or if you do, do you consider those an unnecessary burden there?
    - jhancock 17y ago
      If you own a home, even as an investment as a foreigner, you want to make sure it doesn't get burned down or broken into. This costs, and taxes are used to pay those costs. What will happen to the value of your home if the local water, sewage, roads, schools are not maintained? Even if your child odes not go to school in that district, a high quality school adds significant value to your home price. In China, I pay taxes on my home, and the gov is expected to use some of this money to protect my home there. I'm not being double taxed, I have two homes and pay for each in their respective countries.
      - CWuestefeld 17y ago
        I think you're overlooking the key part of my point. I'm saying that the person has no home in the USA, no nothing. But the USA still taxes income made overseas. Heck, even if this hypothetical person renounces his citizenship, they continue to take the taxes for another ten years!
        jhancock 17y ago
        The reason they are expected to pay is because they made a choice to come to the U.S. and become a part of that society. If you don't want those implications, don't make that choice. The reason people make the choice is because they want the benefits they may get from coming to the U.S. I realize it is too hard for many that come to the U.S. to become citizens; we need to fix that problem. Our immigration strategies are not clear and makes immigrants pay on both ends of the deal. But really, if you want to come to the U.S., suck out some wealth, and then say "so long", well, you'll get what's coming to you.
- krschultz 17y ago
  But the things they mentioned, US Treasuries, stock in US companies ARE benefiting from the US gov't protection. Its not like they are taxing Swiss citizens on Swiss stocks traded on Swiss stock exchanges. They may be fairly unique in doing so, but the US is a fairly unique country in terms of percentage of the global economy. Other countries may have no tax in order to entice more investment, the US does not have to do that. If you don't want to pay the taxes, don't invest in the US economy.
  - CWuestefeld 17y ago
    That may be what the OP mentioned, but it's only part of the picture. If I'm an ex-pat, and make my money as (say) a laborer in another country, my income on that labor will be taxed by the US government. What right do they have to it? the things they mentioned, US Treasuries, stock in US companies ARE benefiting from the US gov't protection The companies that our hypothetical expat owns the stock in already paid corporate income taxes for their own protection. Why should he pay again for it? Really, the questions here are * Should the US government be able to dictate the laws of foreign lands, in order to satisfy its own choice of tax regime? * Should the US government be able to dictate that foreign corporations provide data to the US, forcing those foreign corporations to bear the costs for enforcing the American tax regime?
    - jhancock 17y ago
      * Should the US government be able to dictate the laws of foreign lands, in order to satisfy its own choice of tax regime? No they should not. But this is not what's happening here. The transactions originated in the U.S. by and through U.S. entities. * Should the US government be able to dictate that foreign corporations provide data to the US, forcing those foreign corporations to bear the costs for enforcing the American tax regime? Again, that's not what's happening here. When UBS or any other foreign bank operates in the U.S., it is incorporated as a U.S. entity and must follow U.S. laws. UBS and such have chose to say "oh, those customers we acquired in the U.S., well, that data is back in Switzerland, and we have strict privacy laws there, so no can do". Sorry, but the transactions originated in the U.S. through the U.S. operating entity, Swiss laws have no say here. These banks have gotten off incredibly light. The U.S. has plenty of existing laws on the books to allow them to seize the assets of the entire bank for their illegal behavior. The only reason they did not is because seizing Swiss banks would have unknowable repercussions from global elite.

jhancock 17y ago

Even if their argument was _only_ that one tax issue, its still a legitimate U.S. tax. Allowing non-U.S. citizens to participate in transaction without taxation of U.S. property, yes, private property, amounts to forcing U.S. citizens to carry a larger part of the tax burden. However, this is just their stated issue. The real reasons are much larger than this one taxable interest. If Swiss citizens (or any other doing biz with this "neutral" country) don't want to pay U.S. taxes, they can buy and sell property in Switzerland or some other country that doesn't mind its citizens carrying the tax burden for non-citizens.

joubert 17y ago
How about temporary workers (e.g. 2 year work stint in a bank, etc.) in the US having to pay social security and medicare taxes during that time; a tax for a future benefit that they will never see. I always thought that was super unfair.
- jhancock 17y ago
  That one does seem unfair. To get to the bottom of your issue, you have to figure out how to deal with the case of what if you later choose to become a permanent resident/citizen? Would we need to collect a large sum of back taxes on you? Are you certain you get no benefits as a temporary worker? I am looking into getting my wife non-permanent-residency in the U.S. One part of this is me proving, through prior tax filings, that I live well above the poverty level for a family of 3. The reason for this is once she is here, she can file for welfare and such. So apparently, a new resident, even non-permanent does have some social benefits: welfare, emergency health care, etc. The tax structure is complex, uneven, and government spending is not well controlled. I feel that if we fix issues like we are trying to do with offshore banking, we can get to the next part, which is determining more fair taxation. So long as there are ways out for some, there is not enough force to fix tax fairness issues.
- bluedanieru 17y ago
  Many countries have agreements where if you pay into a national pension in one, it will count as having contributed to the other should you ever return. For example in Japan where I pay into the national pension plan, most of that could be counted for Social Security if I moved back to the States (or, I could opt for a single payment immediately).

run4yourlives 17y ago

US Tax code is the most unfair set of laws I've ever seen to be honest. Most countries wouldn't even dream of demanding the levels of indentured servitude that the IRS feels is their right to collect. In fact, I'd say the only state that is worse at screwing foreigners is - surprise - Switzerland.