Ending US Expat Tax Could Be Revenue Neutral, Says ACA
American Citizens Abroad, which advocates on behalf of US Citizens living outside of the USA, has released new research which suggests Residence Based Taxation could be Revenue Neutral

Following on from the recent news that GOP Congressman Kevin Brady has suggested a possible end to US Expat Taxation, the ACA (American Citizens Abroad) organization has released research which argues that a move to Residence Based Taxation could be 'Revenue Neutral'.

As many Americans living outside of the United States are aware, the current Citizenship Based Taxation (CBT) system requires any individual with US Citizenship to file US tax returns regardless of their residential status, which has led to millions of Americans living abroad needing to file annual tax returns alongside filing in their country of residence. Residence Based Taxation (RBT) would mean that qualified US Citizens resident overseas are no longer subject to US taxation on foreign income.

The research, prepared for the ACA by Washington DC based economic consulting group District Economics Group (DEG), has led to the ACA concluding that RBT can be made revenue neutral. ACA Executive Director, Marylouise Serrato, said "While we have thought for some time that this would be the case, we are very pleased to have this confirmed".

The DEG study, which considered a middle of the road 'vanilla' style approach to RBT, estimates that a revenue neutral budget score for RBT can be arrived at within the 10-year congressional budget window of 2018 through 2027.

Charles Bruce, Chairman of ACA Global Foundation, commenting on the news said that "The analysis of the ACA ‘vanilla’ approach yields a great deal of information about the sensitivities of revenue costs and distributional effects of the various working parts of a RBT proposal. This should prove invaluable for decision-makers."

Further information on the ACA's report can be found via the following links:

ACA Side by Side Comparison of RBT Proposal

DEC Short Memo on Residency Based Taxation Proposal

>> MORE EXPAT ADVICE