Republicans Abroad Europe Statement on Expat Taxation

Republicans Abroad Europe is working directly to raise awareness among party leaders, policy makers and US Presidential candidates about the adverse impact of Expat Taxation and the recent FATCA legislation on the US economy and Americans living overseas.

Our official statement on these issues is below. We encourage you to write Congress about these concerns and contact us if you would like to get involved to support our efforts to reform the tax code.

FATCA

In 2010 the Democrat controlled Congress passed the Foreign Account Tax Compliance Act (FATCA), which now unintentionally threatens to chase trillions of dollars of direct foreign investment out of the United States, undermines the ability of U.S. exporters and companies to do business abroad, and subjects 6.3 million Americans residing outside the United States to an unprecedented abuse of power by the IRS—all at a time when the United States is facing record-high unemployment and requires foreign capital to service its national debt.

Instead of creating jobs in the United States by attracting foreign investment and strengthening the competitiveness of U.S. companies in international markets, the Democrat Party chose to do exactly the opposite by overzealously targeting ordinary American citizens abroad for holding assets offshore and forcing foreign financial institutions to comply with excessive IRS reporting requirements.

As a direct consequence of FATCA, American citizens abroad face stiff penalties even for “unwilful non-compliance” leading to the potential confiscation of their assets and holdings, while foreign financial institutions and investors could be penalized enormously for providing services to and doing business with U.S. citizens.

Foreign financial institutions and investors are therefore considering divestment from U.S. securities and assets altogether, placing at risk $21 trillion in foreign investment upon which U.S. capital markets, companies and ultimately millions of American jobs rely. Foreign investment in U.S. securities alone exceeds $10 trillion against an $18 trillion capitalization of the two U.S. stock exchanges.  

Finally, American citizens and companies abroad are increasingly being denied new business opportunities, participation in partnerships and even simple banking and investment services, as foreign financial institutions and counterparties determine that the costs of FATCA compliance and risks of IRS penalties are simply too high.

Given the devastating impact on investment, exports and U.S. citizens residing abroad, FATCA must be repealed.

Dual Taxation

The United States faces record high unemployment and intense global economic competition. Yet, the United States is the only advanced industrialized country that taxes its citizens working and residing abroad. Whereas other leading export countries encourage their nationals to work overseas to promote their exports and gain valuable international experience to the benefit of their companies, U.S. tax law disincentivizes Americans from working abroad, particularly in critical emerging markets such as the Middle East, Asia and Eastern Europe.

The U.S. system of citizenship-based taxation means fewer Americans are incentivized to work in overseas markets to gain access for U.S. goods and services and to develop vital knowledge and skills for future international growth opportunities.

Just as the Bowles-Simpson National Commission on Fiscal Responsibility recommended a system of territorial taxation for corporations to make American business more competitive, the United States should eliminate the system of citizenship-based taxation for Americans abroad. At a minimum, the United States should lift the cap on the Foreign Earned Income Exclusion to keep pace with the depreciation of the dollar and level the playing field for Americans competing for jobs overseas. 

Act now to register to vote and request an absentee ballot for the upcoming presidential and general elections!

Eligibility to Vote
Generally, all U.S. citizens 18 years or older who are residing outside the United States during an election period are eligible to vote absentee in any election for Federal office. Some states allow overseas voters to vote in state and local elections as well.

Voting eligibility and residency requirements are determined by the various U.S. states, and are available on-line at http://fvap.gov/pubs/vag.html. Your “legal state of residence” for voting purposes is the state where you last resided immediately prior to departure from the United States. Voting rights extend to overseas citizens even though they may no longer own property or have other ties to their last state of residence, and even if their intent to return to that state may be uncertain. For those who have never resided in the United States, sixteen states allow certain U.S. citizens to register where a parent or spouse would be eligible to vote.

Voter Registration & Requesting an Absentee Ballot
Voters who have not yet registered to vote and requested an absentee ballot should do so now.

1. Complete the Federal Post Card Application (FPCA) using the instructions for your state in the Voting Assistance Guide. You may pick up a hard copy of the FPCA from any U.S. Embassy or Consulate, or use the online version.
2. Sign, date and mail the completed FPCA to the address listed in the Voting Assistance Guide. If you are sending the FPCA through international mail, please affix appropriate airmail postage. Alternatively, you can print out apostage-paid address label and ask any U.S. Embassy or Consulate to send your FPCA postage-paid through diplomatic pouch or the military postal service. Some states allow voters to send in the FPCA by fax, but they also require you to send in the hard copy by mail. Follow your state’s regulations precisely.
3. Send in a new FPCA if you have moved or changed your name since the last time you voted.
4. Check your state’s voter registration verification website(http://fvap.gov/vao/stregissites.html), or follow up directly with your local election officials, to confirm that you are registered.

Voting
Your local voting officials should mail your absentee ballot 30 to 45 days before the November 4 general election. Return your voted ballot as early as possible. Be aware of your state’s ballot receipt deadline, as well as any postmarking requirements.

Emergency Ballots
The Federal Write-In Absentee Ballot (FWAB) serves as an emergency ballot for voters who registered in time but fail to receive an official ballot from local election officials. Please note: You must register to vote and request an absentee ballot by your state’s deadline – usually 30 days before the election – to be eligible to use the FWAB. We strongly recommend that voters who have not received their ballot by October 15 complete and return the FWAB to ensure your vote is received in time to be counted.

Questions?
The official U.S. government website for overseas voters is the Federal Voting Assistance Program (FVAP) website at www.fvap.gov.

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