Emigration by the rich may increase substantially as persons seek to avoid home country taxation. Until recently those with high income and wealth could evade taxes through the use of secret foreign investment. Recent policy initiatives from the Obama Administration and the Organisation for Economic Co-operation and Development (OECD) with the G20 promise to reduce such evasion. The US stands virtually alone in its insistence on global taxation of its citizens at home and abroad. Other countries tax only residents and often levy only modest penalties for indefinite departure from the home country. Modern technology coupled with increased international cooperation makes citizenship-based taxation feasible. In a world of sharply varying income – and especially wealth – taxation, states will need to devote increased policy attention to the tax-motivated international mobility of the rich. The attractions of citizenship-based taxation will grow. It should not be abandoned by the US, and its efficacy should be studied by other states.
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