I am flat on my back these days with the mother of all colds. As I near the end of my chemo, this is not a good place to be since the last thing I want is for Chemo Round 6 to be postponed because I'm sniffling and coughing. So I went to the doctor yesterday and have a truckload of antibiotics and strict instructions to stay home and stay warm.
The younger Frenchling was also sick (she was my Typhoid Mary) so we spent a lot of time together - me on the couch and her in her favorite chair. I read paranormal romance novels and she practiced her Japanese by watching anime and other stuff on the Internet. She came across this video which she shared with me. I found it fascinating. It was filmed in Japan and it shows interviewers stopping "gaijin" (foreigners) in the street and asking them to talk (in Japanese) about their favorite things in Japan. (Yes, Nozaki-san, I know you told me not to use the word "gaijin" in polite company but everyone does use it, right?)
The video is in Japanese, a language I do not speak though I know some essential phrases like how to tell the taxi where I live and how to ask for things in the store. Lucky for me I have a translator at home - the younger Frenchling being a big fan of the Japanese language and culture. She has Japanese language classes at school, a private tutor (the mother of one of her sensei's at her Kendo class) and she spends a lot of time on the Net immersing herself in the language.
I don't think, however, that you need to speak Japanese to appreciate this video. Here are people from all over the world (India, Azerbaijan, France, Ireland, USA and other places) being stopped on the street and asked to spontaneously talk about what they like about Japan. They all seemed reasonably comfortable with the language but some were more proficient than others. Check out the body language as well. And it occurred to me as I watched the Americans that there is something really strange about watching one of your compatriots speaking another language. But what really won my heart, I think, was how good-natured the exchanges were. Everyone seemed to be having a good time - no "pieges" (traps) and no criticism - and when there was laughter it was "laughing with" and not "laughing at." This exercise was not designed to embarrass the foreigners though some of the answers were pretty funny. Enjoy.
Thursday, September 27, 2012
Friday, September 21, 2012
Les Visiteurs
It's been a very busy September here at the Flophouse. Not only are we busy with our house project but we have had many visitors this month.
Earlier this month, my mother-in-law came to stay since my spouse was abroad for business and the family agreed that leaving me here by myself was a bad idea. Did I mind? Not a bit. My French mother-in-law is one of the smartest women I know and our conversations are always interesting. Over 80 years old this woman was young when France was invaded during World War II. Later she married a French army officer and moved to Algeria where my spouse and his sister were born. They came back to France in 1962 and lived in various parts of the Hexagone including Versailles. On Sunday we went to mass together at the chapel at the convent of les Sœurs Servantes du Sacré Cœur de Jésus and as we walked she pointed out their old house and the school my sister-in-law attended both of which are very close to our new house in Porchefontaine.
My mother-in-law hails from the Limousin, a sparsely populated region in France that has a very long history. The city closest to the town where she was born and raised is Limoges which was founded in the Roman era (around 10 B.C.) and is best known today for its porcelain.
On one of my very first trips to France my future husband took me out to that region to spend Christmas with his grandmother (my mother-in-law's mother) in Saint Junien. So my first impressions of France were not about Paris but about what they call La France Profonde (Deep France). I remember our trip vividly for two reasons: the grilling that I experienced on the first day by Mémé (she would have made a fine "Inquisiteur" in the Middle Ages) and the quality of the dinner. We had goose from the market and chestnuts. Delicious.
Like her mother, my mother-in-law is one of the best cooks around. What she can do with some inexpensive cuts of meat and a few vegetables is nothing short of miraculous. She is also a great believer in using "les restes" (leftovers). There was some rice left in the fridge and she made a lovely gâteau de riz which I ate for breakfast several days running. To those who argue that copious amounts of money must be spent for the highest quality ingredients in order to eat well, that simply isn't true. What one really needs to eat well and frugally is time. The stew for lunch goes on in mid-morning and preparations for the dinner meal begin not long after lunch. I ate so well during Maman's time here that I gained 2 kilos (about 4 pounds) - something that delighted my doctors at the clinic.
My parents arrived from Seattle via Reyjavik and Amsterdam about a week after my mother-in-law left. Both my parents were born on the U.S. West Coast in the states of Washington and California. They are the perfect guests from out of town. Both are very well-travelled and you could probably drop them just about anywhere in the world and they would make do just fine. My mother who was born in Seattle (which makes me a very rare beast - a second-generation Seattleite) spent her summers working at her grandparent's farm near the village of Naches (population 700) which is close to Yakima in Eastern Washington. Just call this l'Amerique profonde (Deep America). As a result she has a number of skills that are rather uncommon today. In addition to being a fine writer and photographer, she knows how to milk a cow, churn butter, sew, and bake delicious bread and pies (and the pie crust is always hand-made). Of the four skills I've listed here (and I'm sure there are more I don't know about) I've only inherited two out of four and I think the Frenchlings only have one (they love to bake).
They went down to both the local market at Porchefontaine (about 10 minutes away from our apartment) and the main market in the center of Versailles and came back each time with butter and cheese, lamb, and fresh fruits and vegetables. To say that I ate well during their stay would be an understatement. My mother made an open-faced pie with hand-made crust and four kinds of fruit that I am still eating for breakfast. I got on the scale this morning and I've put on roughly another 2 kilos. And it was all good food too - like my French family, my American family doesn't do "Coca-Cola and chips" though I used to sneak these things into the house when I was a teenager. And when my mom found out (as moms always do) there was hell to pay - it was seized as contraband and disposed of forthwith.
So thus far the month of September has been a kind one. I had visits from people I love and don't get to see nearly as often as I would like. There was intellectual stimulation, good conversation and a steady stream of fine food that I didn't have to cook. I am also about 4 kilos heavier - a good thing since, like all the folks in my family with Norwegian blood, I tend to be on the tall and thin side: 173 centimeters (5 feet 8 inches) and about 54 kilos (119 pounds). Not the best place to start when you are facing 5 rounds of pretty aggressive chemotherapy.
Fortunately for me, "Mom" and "Maman" have made it their mission to correct this and today this particular problem is well on its way to being resolved. Between you and me, I feel a lot better and stronger. Which for me just proves beyond a shadow of a doubt Michael Pollan's food rule, "Don’t eat anything that your great-grandmother wouldn’t recognize as food." Only way to do better is to actually have grandma/grandmère come by and cook that "real food" for you.
Earlier this month, my mother-in-law came to stay since my spouse was abroad for business and the family agreed that leaving me here by myself was a bad idea. Did I mind? Not a bit. My French mother-in-law is one of the smartest women I know and our conversations are always interesting. Over 80 years old this woman was young when France was invaded during World War II. Later she married a French army officer and moved to Algeria where my spouse and his sister were born. They came back to France in 1962 and lived in various parts of the Hexagone including Versailles. On Sunday we went to mass together at the chapel at the convent of les Sœurs Servantes du Sacré Cœur de Jésus and as we walked she pointed out their old house and the school my sister-in-law attended both of which are very close to our new house in Porchefontaine.
My mother-in-law hails from the Limousin, a sparsely populated region in France that has a very long history. The city closest to the town where she was born and raised is Limoges which was founded in the Roman era (around 10 B.C.) and is best known today for its porcelain.
On one of my very first trips to France my future husband took me out to that region to spend Christmas with his grandmother (my mother-in-law's mother) in Saint Junien. So my first impressions of France were not about Paris but about what they call La France Profonde (Deep France). I remember our trip vividly for two reasons: the grilling that I experienced on the first day by Mémé (she would have made a fine "Inquisiteur" in the Middle Ages) and the quality of the dinner. We had goose from the market and chestnuts. Delicious.
Like her mother, my mother-in-law is one of the best cooks around. What she can do with some inexpensive cuts of meat and a few vegetables is nothing short of miraculous. She is also a great believer in using "les restes" (leftovers). There was some rice left in the fridge and she made a lovely gâteau de riz which I ate for breakfast several days running. To those who argue that copious amounts of money must be spent for the highest quality ingredients in order to eat well, that simply isn't true. What one really needs to eat well and frugally is time. The stew for lunch goes on in mid-morning and preparations for the dinner meal begin not long after lunch. I ate so well during Maman's time here that I gained 2 kilos (about 4 pounds) - something that delighted my doctors at the clinic.
My parents arrived from Seattle via Reyjavik and Amsterdam about a week after my mother-in-law left. Both my parents were born on the U.S. West Coast in the states of Washington and California. They are the perfect guests from out of town. Both are very well-travelled and you could probably drop them just about anywhere in the world and they would make do just fine. My mother who was born in Seattle (which makes me a very rare beast - a second-generation Seattleite) spent her summers working at her grandparent's farm near the village of Naches (population 700) which is close to Yakima in Eastern Washington. Just call this l'Amerique profonde (Deep America). As a result she has a number of skills that are rather uncommon today. In addition to being a fine writer and photographer, she knows how to milk a cow, churn butter, sew, and bake delicious bread and pies (and the pie crust is always hand-made). Of the four skills I've listed here (and I'm sure there are more I don't know about) I've only inherited two out of four and I think the Frenchlings only have one (they love to bake).
They went down to both the local market at Porchefontaine (about 10 minutes away from our apartment) and the main market in the center of Versailles and came back each time with butter and cheese, lamb, and fresh fruits and vegetables. To say that I ate well during their stay would be an understatement. My mother made an open-faced pie with hand-made crust and four kinds of fruit that I am still eating for breakfast. I got on the scale this morning and I've put on roughly another 2 kilos. And it was all good food too - like my French family, my American family doesn't do "Coca-Cola and chips" though I used to sneak these things into the house when I was a teenager. And when my mom found out (as moms always do) there was hell to pay - it was seized as contraband and disposed of forthwith.
So thus far the month of September has been a kind one. I had visits from people I love and don't get to see nearly as often as I would like. There was intellectual stimulation, good conversation and a steady stream of fine food that I didn't have to cook. I am also about 4 kilos heavier - a good thing since, like all the folks in my family with Norwegian blood, I tend to be on the tall and thin side: 173 centimeters (5 feet 8 inches) and about 54 kilos (119 pounds). Not the best place to start when you are facing 5 rounds of pretty aggressive chemotherapy.
Fortunately for me, "Mom" and "Maman" have made it their mission to correct this and today this particular problem is well on its way to being resolved. Between you and me, I feel a lot better and stronger. Which for me just proves beyond a shadow of a doubt Michael Pollan's food rule, "Don’t eat anything that your great-grandmother wouldn’t recognize as food." Only way to do better is to actually have grandma/grandmère come by and cook that "real food" for you.
Wednesday, September 19, 2012
Diaspora Taxes: The Inheritance Tax
Not long ago we looked at different ways that countries tax their diasporas. We began the series by asking some very basic questions about territorial and extra-territorial taxation and then moved on to tax systems that specifically target a country's population living outside of national borders: citizenship-based taxation and exit taxes. But there was one we missed and it's an important one - estate/inheritance tax.
A country may or may not (usually not) practice territorial taxation on investments and earned income but may still seek to extract some revenue from worldwide assets when an individual performs the ultimate act of expatriation - death.
It's worth asking the question of why inheritance is taxed in the first place since we can presume that during the lifetime of the person in question he/she already paid taxes (capital gains, income tax and so one) on that money when it was being earned. One argument in favor of it is that it is good social policy - it generates revenue for the state, breaks up concentrations of wealth, promotes social equality and discourages the creation of an "idle class" (those infamous "rentiers"). As Andrew Carnegie put it: "The parent who leaves his son enormous wealth generally deadens the talents and energies of the son, and leads him to lead a less useful and less worthy life than he otherwise would." Bill Gates concurs and has said that he not only supports the estate tax but he plans on leaving 95% of his fortune to charity as opposed to his children. “Once they graduate from college, then they’re largely on their own."
Those arguments are countered by those who say that it doesn't generate significant revenue, is a drag on economic growth, is harmful to small businesses and farms which must be broken up to pay taxes, and encourages a "Die broke" mentality.
Into this debate allow me to add another layer of complexity. Assuming that most states have some form of an inheritance tax, when a person with assets in multiple countries dies, which government gets a cut? The country of citizenship or the country of residency? Or both? This is important to know if, for example, you are a bi-national couple with dual citizen children - a family that lives at the intersection of two or more sets of national laws.
Please bear in mind as we discuss this that I am not a tax professional and do not play one on TV so double-check my information and feel free to correct me if you find errors.
France: If you are a resident of France (French citizen or not) your worldwide estate is subject to French tax. As Service-Public says, "Si le défunt était domicilié en France, vous êtes soumis aux droits de succession sur tous les biens reçus, qu'ils soient situés en France ou à l'étranger." (If the deceased was resident in France, then you [the heir] are subject to inheritance tax on all the assets received in France and abroad.) However, that may be mitigated by tax conventions signed between nations so it is best to check with an international tax lawyer in your particular case. There is one that covers France/US estate taxes that I found on the U.S. Embassy website.
There is also EU legislation that will come into effect in 2015 that will impact succession laws in all EU states. This is not about taxes, it is about inheritance laws. Regulation (EU) No 650/2012 of the European Parliament and of the Council of 4 July 2012 would allow someone to draw up a valid will that is conform with the laws of his country of citizenship. So in theory, I, a US citizen residing in France, could draw up a will and leave all my worldly possessions to my cat, Minouche.
United States: So what happens if you are a French citizen living in the U.S.? Just like the worldwide tax on income, the U.S. can tax you on your worldwide "patrimoine" if you are on U.S. soil when you pass on. This applies if you are a dual U.S./French citizen, a resident alien or in some cases, a non-resident alien. An example of the last would be a Canadian who resides in Canada but has a vacation home worth more than 60,000 USD in the U.S. Deloitte has an excellent guide to how it works here.
As for Americans citizens living abroad and U.S. estate taxes, yes, there are tax returns to file and, depending on the value of the estate, taxes to pay. Be aware that those tax conventions may be no help at all. This site says: "In these treaties, the United States also reserves the right to tax the estates of its citizens as though the treaty was not in effect at all. Under the terms of its treaty with France, the United States may tax French property owned by U.S. citizens, thus creating the potential of a double tax on the bequest. "
There is also the matter of an American whose spouse is not a U.S. citizen. In the case of a bi-national couple where one is a U.S. citizen and the other is not, this KPMG article says that this has important implications: "The most important estate tax deduction is the marital deduction, which generally permits all transfers of property to the decedent’s spouse to be excluded from taxation, but only if the spouse is a U.S. citizen. Generally, no marital deduction is allowable for property passing outright to a spouse who is not a U.S. citizen."
Are the U.S. and France outliers when it comes to complex estate/inheritance taxes on worldwide assets? Not at all. For an overview of the rules of 27 different countries around the globe, have a look at the superb Ernst and Young International Estate and Inheritance Tax Guide 2012 which is a marvelous resource for those of you who are (like me) complete novices when it comes to international estate planning.
When it comes to cross-border inheritance the sheer number of intersecting national laws and tax treaties make it nearly impossible for the average human to understand all the implications and consequences. Plus these things are not static - laws change, new treaties are signed, capital (human and financial) moves across borders and people keep doing what people generally do: get born, get married, work, have children and pass away. It's a little like a diabolical game of musical chairs where the music stops forever and for all time for one individual (the deceased) and the distribution of his assets depends both on where he lands on the floor and in what seats his heirs find themselves at that moment.
My conclusion? If you are a global migrant or part of a family whose members or assets spans countries or continents, find yourself a competent professional and get this sorted out sooner rather than later.
A country may or may not (usually not) practice territorial taxation on investments and earned income but may still seek to extract some revenue from worldwide assets when an individual performs the ultimate act of expatriation - death.
It's worth asking the question of why inheritance is taxed in the first place since we can presume that during the lifetime of the person in question he/she already paid taxes (capital gains, income tax and so one) on that money when it was being earned. One argument in favor of it is that it is good social policy - it generates revenue for the state, breaks up concentrations of wealth, promotes social equality and discourages the creation of an "idle class" (those infamous "rentiers"). As Andrew Carnegie put it: "The parent who leaves his son enormous wealth generally deadens the talents and energies of the son, and leads him to lead a less useful and less worthy life than he otherwise would." Bill Gates concurs and has said that he not only supports the estate tax but he plans on leaving 95% of his fortune to charity as opposed to his children. “Once they graduate from college, then they’re largely on their own."
Those arguments are countered by those who say that it doesn't generate significant revenue, is a drag on economic growth, is harmful to small businesses and farms which must be broken up to pay taxes, and encourages a "Die broke" mentality.
Into this debate allow me to add another layer of complexity. Assuming that most states have some form of an inheritance tax, when a person with assets in multiple countries dies, which government gets a cut? The country of citizenship or the country of residency? Or both? This is important to know if, for example, you are a bi-national couple with dual citizen children - a family that lives at the intersection of two or more sets of national laws.
Please bear in mind as we discuss this that I am not a tax professional and do not play one on TV so double-check my information and feel free to correct me if you find errors.
France: If you are a resident of France (French citizen or not) your worldwide estate is subject to French tax. As Service-Public says, "Si le défunt était domicilié en France, vous êtes soumis aux droits de succession sur tous les biens reçus, qu'ils soient situés en France ou à l'étranger." (If the deceased was resident in France, then you [the heir] are subject to inheritance tax on all the assets received in France and abroad.) However, that may be mitigated by tax conventions signed between nations so it is best to check with an international tax lawyer in your particular case. There is one that covers France/US estate taxes that I found on the U.S. Embassy website.
There is also EU legislation that will come into effect in 2015 that will impact succession laws in all EU states. This is not about taxes, it is about inheritance laws. Regulation (EU) No 650/2012 of the European Parliament and of the Council of 4 July 2012 would allow someone to draw up a valid will that is conform with the laws of his country of citizenship. So in theory, I, a US citizen residing in France, could draw up a will and leave all my worldly possessions to my cat, Minouche.
United States: So what happens if you are a French citizen living in the U.S.? Just like the worldwide tax on income, the U.S. can tax you on your worldwide "patrimoine" if you are on U.S. soil when you pass on. This applies if you are a dual U.S./French citizen, a resident alien or in some cases, a non-resident alien. An example of the last would be a Canadian who resides in Canada but has a vacation home worth more than 60,000 USD in the U.S. Deloitte has an excellent guide to how it works here.
As for Americans citizens living abroad and U.S. estate taxes, yes, there are tax returns to file and, depending on the value of the estate, taxes to pay. Be aware that those tax conventions may be no help at all. This site says: "In these treaties, the United States also reserves the right to tax the estates of its citizens as though the treaty was not in effect at all. Under the terms of its treaty with France, the United States may tax French property owned by U.S. citizens, thus creating the potential of a double tax on the bequest. "
There is also the matter of an American whose spouse is not a U.S. citizen. In the case of a bi-national couple where one is a U.S. citizen and the other is not, this KPMG article says that this has important implications: "The most important estate tax deduction is the marital deduction, which generally permits all transfers of property to the decedent’s spouse to be excluded from taxation, but only if the spouse is a U.S. citizen. Generally, no marital deduction is allowable for property passing outright to a spouse who is not a U.S. citizen."
Are the U.S. and France outliers when it comes to complex estate/inheritance taxes on worldwide assets? Not at all. For an overview of the rules of 27 different countries around the globe, have a look at the superb Ernst and Young International Estate and Inheritance Tax Guide 2012 which is a marvelous resource for those of you who are (like me) complete novices when it comes to international estate planning.
When it comes to cross-border inheritance the sheer number of intersecting national laws and tax treaties make it nearly impossible for the average human to understand all the implications and consequences. Plus these things are not static - laws change, new treaties are signed, capital (human and financial) moves across borders and people keep doing what people generally do: get born, get married, work, have children and pass away. It's a little like a diabolical game of musical chairs where the music stops forever and for all time for one individual (the deceased) and the distribution of his assets depends both on where he lands on the floor and in what seats his heirs find themselves at that moment.
My conclusion? If you are a global migrant or part of a family whose members or assets spans countries or continents, find yourself a competent professional and get this sorted out sooner rather than later.
Monday, September 17, 2012
Citizenship - Name Your Price
Broadly defined, citizenship is membership in a political community. Like any club it has benefits and it has duties and responsibilities. But citizenship is perceived to be something much more than just a simple contact between an individual and a state - this is not supposed to be like signing up with Club Med. With citizenship some of the membership rules are explicit (defined by law) but many more are implicit (an understanding or an unwritten social contract). A citizen can be fully compliant with the rules and yet fall afoul of the social contract and be vilified or shunned by the other members.
Attempts to reduce citizenship to a simple cost/benefit analysis or to tie it to monetary terms is almost always regarded with disdain, if not downright hostility. Most people would agree that this connection is not something that should be bought or sold or traded (but it can be inherited or earned through service). To be an American or a Frenchman or a Japanese is supposed to be something a bit more than just a set of rights and a list of duties. What that "something" is can be hotly debated but it seems to come down to a kind of emotional attachment plus a willingness to sacrifice on behalf of the nation. It is a status fraught with meaning.
So a suggestion that we think of citizenship as just another membership in a club where each individual does a personal cost/benefit analysis of present and future benefits and then swaps memberships at will according to his/her interests tends to arouse very angry, very emotional, responses. Most people agree that citizenship is not a membership to be traded in for something better for purely financial reasons. Those who are perceived as trying to do just that (Eduardo Saverin and Bernard Arnault) are considered to be the worst sort of traitorous villains.
And yet the nation-states involved (and their citizens) seem entirely comfortable with the idea of offering very interesting incentives to draw rich and talented residents to their shores. Remember that every immigrant is someone else's emigrant and one state's gain is another's loss. To those who argue that citizenship has no price (or should not be priced), one doesn't have to look far to find ways that states themselves put a sticker price on citizenship/residency and invite migrants to meet it for mutual advantage and profit. The U.S. and France are not exceptions to this. Don't believe me? My French spouse didn't so I went and looked and this is what I found:
Carte résident - contribution économique exceptionnelle: For the modest sum of 10 million Euros and/or a commitment to create (or save) 50 jobs, an investor will receive a French residency permit good for 10 years. As a bonus, the immigrant investor is relieved of two requirements: the "Visite medicale" and the "Contrat d'Accueil et d'Intégration." Citizenship in this case is just a short step away since someone who is deemed to have "rendu (ou peut rendre) des services importants à la France" can apply for French citizenship after a mere two years of residency.
Hard to see this as much more than a purely commercial transaction and the French government website is not coy about the deal:
So for 10 million euros you can be French (EU) and for 500,000 USD you can be American.
A hell of a deal, don't you think?
A modest suggestion to the citizens of the two nations mentioned above: if you don't want individuals shopping around for the best citizenship "deal" and you wish to vilify those who do, your moral posturing would be much more credible if you weren't the ones putting it up for sale in the first place.
Attempts to reduce citizenship to a simple cost/benefit analysis or to tie it to monetary terms is almost always regarded with disdain, if not downright hostility. Most people would agree that this connection is not something that should be bought or sold or traded (but it can be inherited or earned through service). To be an American or a Frenchman or a Japanese is supposed to be something a bit more than just a set of rights and a list of duties. What that "something" is can be hotly debated but it seems to come down to a kind of emotional attachment plus a willingness to sacrifice on behalf of the nation. It is a status fraught with meaning.
So a suggestion that we think of citizenship as just another membership in a club where each individual does a personal cost/benefit analysis of present and future benefits and then swaps memberships at will according to his/her interests tends to arouse very angry, very emotional, responses. Most people agree that citizenship is not a membership to be traded in for something better for purely financial reasons. Those who are perceived as trying to do just that (Eduardo Saverin and Bernard Arnault) are considered to be the worst sort of traitorous villains.
And yet the nation-states involved (and their citizens) seem entirely comfortable with the idea of offering very interesting incentives to draw rich and talented residents to their shores. Remember that every immigrant is someone else's emigrant and one state's gain is another's loss. To those who argue that citizenship has no price (or should not be priced), one doesn't have to look far to find ways that states themselves put a sticker price on citizenship/residency and invite migrants to meet it for mutual advantage and profit. The U.S. and France are not exceptions to this. Don't believe me? My French spouse didn't so I went and looked and this is what I found:
Carte résident - contribution économique exceptionnelle: For the modest sum of 10 million Euros and/or a commitment to create (or save) 50 jobs, an investor will receive a French residency permit good for 10 years. As a bonus, the immigrant investor is relieved of two requirements: the "Visite medicale" and the "Contrat d'Accueil et d'Intégration." Citizenship in this case is just a short step away since someone who is deemed to have "rendu (ou peut rendre) des services importants à la France" can apply for French citizenship after a mere two years of residency.
Hard to see this as much more than a purely commercial transaction and the French government website is not coy about the deal:
Le critère de délivrance de la carte de séjour pour les investisseurs étrangers en France est explicitement lié à la contribution économique qu'ils apportent au pays. Ce nouveau dispositif vise à faciliter et à encourager le séjour des ressortissants étrangers qui s’engagent à effectuer sur le territoire français un investissement d’au moins 10 millions d’euros et à créer ou sauvegarder au moins 50 emplois en France. Ils reçoivent en contrepartie une carte de séjour d’une durée de 10 ans.EB-5 Immigrant Investor: This has been described as a "Visa for Dollars" or "Swapping boat people for yacht people" program. If you ignore the citizenship-based taxation part of US tax policy this is a steal compared to France. For the very reasonable sum of 1 million U.S. dollars (500,000 in a poverty-stricken area) and the creation of a measly 10 jobs, an investor get an immigrant visa and a conditional Green Card. Once the probation period is over he gets a regular Green Card and a path to U.S. citizenship after 5 years. Other advantages are being able to the family over and the children can work or go to a U.S. school and benefit from in-state tuition rates. Investors must reside in the U.S. but they only have to be physically present on U.S. soil for 180 days out of the year. The only catch is that they have the same reporting and tax obligations as other Green Card holders: they must report and pay taxes on their worldwide income and assets. Again, like the French program, this is a purely commercial arrangement - a genuine quid pro quo.
(The criteria for delivery of a residency permit for foreign investors in France is explicitly linked to the economic contribution that they bring to the country. This new program is meant to facilitate and encourage the residency of foreign citizens who agree to invest 10 million Euros and to create or save at least 50 jobs in France. They receive in exchange a 10 year residency permit.)
So for 10 million euros you can be French (EU) and for 500,000 USD you can be American.
A hell of a deal, don't you think?
A modest suggestion to the citizens of the two nations mentioned above: if you don't want individuals shopping around for the best citizenship "deal" and you wish to vilify those who do, your moral posturing would be much more credible if you weren't the ones putting it up for sale in the first place.
Saturday, September 15, 2012
La Fête de l’Humanité
It's September, the children are back in school and their parents are back to work (some of them anyway) and it's time for the other main event of La Rentreé, La Fête de l’Humanité.
This is a huge festival held in the Paris region every year and it's quite the party with music, debates, expositions and other "spectacles." As always people are having a rip roaring good time. The concert program alone is pretty impressive with just about every kind of music you can imagine. If I could go, however, I would attend the debates. What I would give to be there for the discussion on topics like:
Qu’est devenu le Printemps arabe? (What Has the Arab Spring Become?), Vivons-nous en démocratie? (Do We Live in a Democracy?) and the not-to-be-missed Quand l’Amérique s’éveillera (When America Awakes).
The last is perhaps more a hope than a reality. I was raised by American hippies, people who dreamed of such an awakening, but it didn't happen 50 years ago and I'm not sure things are looking up as we enter the 21st century. As I contemplate voting in the 2012 U.S. elections I find myself singing:
Well I don't know why I came here tonight
This is a huge festival held in the Paris region every year and it's quite the party with music, debates, expositions and other "spectacles." As always people are having a rip roaring good time. The concert program alone is pretty impressive with just about every kind of music you can imagine. If I could go, however, I would attend the debates. What I would give to be there for the discussion on topics like:
Qu’est devenu le Printemps arabe? (What Has the Arab Spring Become?), Vivons-nous en démocratie? (Do We Live in a Democracy?) and the not-to-be-missed Quand l’Amérique s’éveillera (When America Awakes).
The last is perhaps more a hope than a reality. I was raised by American hippies, people who dreamed of such an awakening, but it didn't happen 50 years ago and I'm not sure things are looking up as we enter the 21st century. As I contemplate voting in the 2012 U.S. elections I find myself singing:
Well I don't know why I came here tonight
I got the feeling that something ain't right
I'm so scared in case I'll fall off my chair
And I'm wondering how I'll get down the stairs
Clowns to the left of me, jokers to the right, here I am
Stuck in the middle with you
La Fête de l’Humanité has been around since 1930. At that time the French government was putting Communists in prison and the party fought back in various ways one of which was this festival held to bring people together and to finance their journal l’Humanité which is still alive and well today. The festival has grown up over the years - it's a lot more diverse and will welcome hundreds of thousands of people this weekend to the festivities at la Courneuve en Seine-Saint-Denis.
For this 77th manifestation of the Fête, the director of l'Humanité, Patrick Le Hyaric, gleefully wrote:
La Fête de l’Humanité has been around since 1930. At that time the French government was putting Communists in prison and the party fought back in various ways one of which was this festival held to bring people together and to finance their journal l’Humanité which is still alive and well today. The festival has grown up over the years - it's a lot more diverse and will welcome hundreds of thousands of people this weekend to the festivities at la Courneuve en Seine-Saint-Denis.
For this 77th manifestation of the Fête, the director of l'Humanité, Patrick Le Hyaric, gleefully wrote:
"Nous avions clamé l'an passé, sur des affiches, des tee-shirts, sur la grande scène, que la Fête de l'Humanité 2011 devrait être la dernière fête avec Sarkozy pour président. C'est le cas aujourd'hui!"
(We said last year, on posters, t-shirts and on the main stage, that the 2011 Fête de l'Humanité would be the last festival with Sarkozy as president. And that is the case today!)
May I say how delighted I am that somebody is getting his heart's desire this election year.
Bon weekend, everyone.
Wednesday, September 12, 2012
A Manifesto from the Americans in Switzerland
From Jean-Jacques' Citation du Jour:
"Si vous avez l'impression d'être trop petit pour pouvoir changer quelque chose, essayez donc de dormir avec un moustique et vous verrez lequel des deux empêche l'autre de dormir."
“In case you think you are too small to change anything, try sleeping with a mosquito, and figure out which one is depriving the other of sleep.”
Tenzin Gyatso, shortened from Jetsun Jamphel Ngawang Lobsang Yeshe Tenzin Gyatso, born Lhamo Dondrub,14th Dalai Lama (1935-)
The American Diaspora is relatively small: 6-7 million Culex Pipiens versus 300 million homelanders. That is not our only disadvantage - Americans abroad are a very diverse population scattered among the 190+ countries of the world and for the most part we don't ask much of the homeland or publicize our presence outside the U.S. That's changing as a result of some burning issues that are bringing us all together. Communicating how we feel about them and getting heard, however, has been a sisyphean task. Our letters go unanswered by lawmakers and our fellow citizens toggle between hostility and indifference when we try to talk about it. It's almost impossible to understand the magnitude of the problems and how the situation between Americans abroad and the homeland has degraded until you see the list (the very long list) of grievances. It's not just about FATCA, my friends.
We were sorely in need of a good "synthèse" - something that brought together the issues, our frustration and feelings, and what we want to have happen next. Earlier this year a group of American citizens and organization in Switzerland held a series of Town Hall Meetings in five Swiss cities. The report on The Concerns of Overseas Americans that came out of these gatherings is exactly what we needed. I read it over carefully and can attest personally to the fact that the major issues they cite are not at all confined to Americans in Switzerland or Europe, but are being experienced by Americans abroad all over the world wherever they live. I fully support their recommendations which I find both reasonable and relatively modest. We are hardly asking for the moon here, folks.
This report has already been sent to every member of the U.S. Congress but let's take it one step further. I strongly encourage everyone to pass it along to other Americans abroad, to friends and family back in the U.S., to every candidate running for office in your U.S. voting district, and to every national and hometown newspaper.
If enough of us buzz loudly enough perhaps we can keep the homeland humans awake long enough to hear us out. And if that doesn't work, let's draw some blood and get them scratching...
Tuesday, September 11, 2012
The Hollande Tax and Emigration
Those pesky campaign promises. During the 2012 French presidential elections François Hollande announced his intention to tax people earning over 1 million Euros a year at 75%. Now that he's president, the pressure is on and his supporters want him to keep his word.
Hard times here. Unemployment is up (9.7%) and at the beginning of this month the number of unemployed reached 3 million - something that Rue89 is calling "un électrochoc national." It's not likely to get better soon and the idea that the rich should pay more taxes is pretty popular politically.
But now pressure is coming from another direction. Bernard Arnault, the CEO of LVMH, has made a request for Belgian citizenship. Mr. Arnault says that this move is not a result of tax policy and that he simply wants dual citizenship to take advantage of business opportunities. He already has a home in Bruxelles though he remains, for the moment, a French resident for tax purposes. I believe him. It's not really about citizenship since France does not have a citizenship-based taxation system. All Mr. Arnault has to do (provided he pays the applicable exit taxes) is to change his residence and he can do that as a French or a Belgian or a Martian. He's an EU citizen and has the right to move to whatever country here will have him.
Nevertheless people are asking themselves if he will be the first of a wave of emigration out of France toward more fiscally interesting locales and that is making everyone a bit nervous. What use is a 75% tax on the rich if the 2-3000 people it applies to pack up and leave? Sure they will pay something on their way out but the state will lose all that potential revenue for the future. 75% of nothing is still zero last time I looked.
Quite a conundrum that the French government is taking very seriously. As this article in Le Parisien puts it: "Dans ce contexte, tout recul sur la taxation des plus riches serait inacceptable aux yeux de l’opinion publique. Mais comment éviter un impôt « confiscatoire » et risquer un exil des talents?" (In this context, backsliding on taxing the richest would be unacceptable in the eyes of public opinion. But how to avoid "confiscatory" taxes and the risk of losing talent?)
That is the question of the hour and one that is being asked in many countries all over the world who are struggling with troubled economies and high deficits. The details of Hollande's plan will be only be known at the end of this month. Can Hollande and his government find a compromise that satisfies everyone? A suivre....
Hard times here. Unemployment is up (9.7%) and at the beginning of this month the number of unemployed reached 3 million - something that Rue89 is calling "un électrochoc national." It's not likely to get better soon and the idea that the rich should pay more taxes is pretty popular politically.
But now pressure is coming from another direction. Bernard Arnault, the CEO of LVMH, has made a request for Belgian citizenship. Mr. Arnault says that this move is not a result of tax policy and that he simply wants dual citizenship to take advantage of business opportunities. He already has a home in Bruxelles though he remains, for the moment, a French resident for tax purposes. I believe him. It's not really about citizenship since France does not have a citizenship-based taxation system. All Mr. Arnault has to do (provided he pays the applicable exit taxes) is to change his residence and he can do that as a French or a Belgian or a Martian. He's an EU citizen and has the right to move to whatever country here will have him.
Nevertheless people are asking themselves if he will be the first of a wave of emigration out of France toward more fiscally interesting locales and that is making everyone a bit nervous. What use is a 75% tax on the rich if the 2-3000 people it applies to pack up and leave? Sure they will pay something on their way out but the state will lose all that potential revenue for the future. 75% of nothing is still zero last time I looked.
Quite a conundrum that the French government is taking very seriously. As this article in Le Parisien puts it: "Dans ce contexte, tout recul sur la taxation des plus riches serait inacceptable aux yeux de l’opinion publique. Mais comment éviter un impôt « confiscatoire » et risquer un exil des talents?" (In this context, backsliding on taxing the richest would be unacceptable in the eyes of public opinion. But how to avoid "confiscatory" taxes and the risk of losing talent?)
That is the question of the hour and one that is being asked in many countries all over the world who are struggling with troubled economies and high deficits. The details of Hollande's plan will be only be known at the end of this month. Can Hollande and his government find a compromise that satisfies everyone? A suivre....
Subscribe to:
Posts (Atom)