End Citizenship Based Taxation & switch to Residency Based Taxation

Liberty
,
1

The US should end Citizenship-Based Taxation (CBT), and switch to Residency-Based Taxation (RBT).

The US is the only country that fully enforces citizenship-based taxation (CBT) on its citizens. This means US citizens who live and reside abroad, must still deal with the burden of filing US taxes every year (the time, worry, financial cost to research & comply, potential taxes owed, & liability of making filing mistakes, etc) and potentially paying taxes owed…even when not living & residing in the United States.

The vast majority of countries—over 130 nations—use Residency Based Taxation, because it is more equitable and aligns tax obligations with the benefits and services provided by the country of residence.

Key points

  • Global Norm: The US is the only country that fully enforces citizenship-based taxation on its citizens. The vast majority of countries, 130+, use residency-based taxation.
  • Unnecessary Burden: CBT imposes a burden on U.S. citizens living abroad, who face the stress, time & financial cost to research & comply, including the liability of mistakes, to file taxes each year—in addition to filing taxes in the country where they reside.
  • Fairness: Residency-based taxation (RBT) is more fair because it taxes only those who live and reside within a country and consume its public services.
  • Morality - No country owns its citizens. America was founded to not pay taxes to the British in a far away land where we did even not live. Residency-Based Taxation (RBT) is the only moral basis for taxation.

Conclusion

The US should end Citizenship Based Taxation (CBT), and switch to Residency Based Taxation (RBT).

4 Likes
2

How about we just end the Fed and end income taxes altogether? Have the government go back to getting money from tariffs and maybe a small non essentials consumption tax.

I’m sick of everyone trying to steal my money.

2 Likes
3

I would vote for this, but have no votes left, so here’s a “:heart:”, instead!

4

This is a good idea- There is a emergent competition in the world where countries will be vying for “residents” to live within their sphere of control . This has large benefits to the involved taxation base as a country motivator to implement policies like this ( making life in a given country viable and tax-competitive for high net worth earners) and a direct outcome of the game theory around setting up reliant and sound monetary (not debase-able) financial systems.

1 Like