Many American expats are following in the footsteps of Facebook co-founder Eduardo Saverin and ditching their US citizenship, the Wall Street Journal reports. In likely related news, the US is cracking down on overseas tax evaders. The number of citizenship renouncers is not huge, but it is growing in record numbers—of the 6 million Americans living outside the country, 1,130 expatriated themselves in the second quarter of this year, more than all of 2012, and the single highest quarter ever recorded, the Hill reports.
The main reason, lawyers tell the Journal, is the Foreign Account Tax Compliance Act, which requires overseas citizens and green card holders to declare their offshore assets. For wealthy citizens living in Asian countries like Hong Kong, where the individual tax rate is a maximum of 15%, the US tax burden can seem heavy—not to mention the forms they have to fill out. "My decision was less about the actual amount of taxes I had to pay, and more about the system," says a Hong Kong investment banker who renounced his citizenship. "I'm not an ultrawealthy dude. It was the hassle with all the paperwork."