US senators Charles Schumer and Bob Casey have introduced a new proposal in response to Facebook creator Eduardo Saverin's planned attempt to dodge his tax bill.
The new proposal would force millionaire expatriates like Saverin to pay taxes on US investments even after they relinquish citizenship. Senator Schumer alleges Saverin became an American expatriate last year to avoid paying taxes. Saverin allegedly relinquished his US citizenship in an attempt to dodge a potential $64m tax bill.
"Mr Saverin has decided to ‘defriend' the United States of America just to avoid paying his taxes," Schumer said.
"We aren't going to let him get away with it so easily."
Under the new proposal, ex-pats with a net worth of more than $2m will be investigated by the IRS to examine whether they relinquished citizenship just to avoid paying taxes. If found guilty of tax evasion, the ex-pat would be required to pay a tax on future investment gains no matter where they are residing.
Saverin co-created Facebook while at Harvard with Mark Zuckerberg, and stood to gain almost $3bn as the company floated on the stock exchange last week.
The Facebook co-founder claimed his decision to relinquish US citizenship had nothing to do with taxes. Saverin says he only gave up citizenship because he plans to live in Singapore for the foreseeable future.
"My decision to expatriate was based solely on my interest in working and living in Singapore, where I have been since 2009," Saverin said in a statement provided to V3.
"I have paid and will continue to pay any taxes due on everything I earned while a US citizen. It is unfortunate that my personal choice has led to a public debate, based not on the facts, but entirely on speculation and misinformation."
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