House Speaker John Boehner has become the latest politician to attack Facebook billionaire Eduardo Saverin for ditching his U.S. citizenship to avoid paying tax.
Speaking on ABC’s This Week, Mr Boehner labelled the move ‘absolutely outrageous’ and said he would support legislation to stop wealthy expats relocating to dodge tax.
Mr Saverin, who pocketed more than $2billion when the social-networking site listed on the stock exchange on Friday, could avoid paying hundreds of millions of dollars in U.S. taxes after he relocated to Singapore.
Senator Chuck Schumer, a Democrat from New York, and Senator Bob Casey, a Democrat from Pennsylvania, lambasted the 30-year-old on Thursday as they introduced special legislation – the EX-PATRIOT Act – to force him to cough up his fair share to the American government and bar him from ever visiting the states.
The bill would require anyone who ‘expatriates for a substantial tax purpose’ as judged by the Internal Revenue Service to pay 30 per cent tax on future capital gains.
Former citizens would also be turned back at the border if they ever tried to return to America.
Mr Boehner, an Ohio Republican, is the latest to take aim at the party-loving tech geek, declaring that he would support the new law if necessary.
‘There’s already a law in the books George, but this is outrageous,’ he said to The Week host George Stephanopoulos.
‘This is absolutely outrageous that somebody would renounce their citizenship to avoid paying taxes. If it’s necessary, sure I would support [this legislation].’
The politicians are concerned Mr Saverin will skip out on massive capital gains he made on the IPO.
By renouncing U.S. citizenship, Mr Saverin will only have to pay Singapore’s 20 per cent tax rate on future income instead of 39.6 per cent in the U.S., and has will avoid future capital gains tax altogether.
In a statement on Thursday, Mr Saverin insisted his decision to renounce U.S. citizenship was ‘based solely on my interest in working and living’ in Singapore, and said that he would fulfill all his tax obligations.