As if you needed a reason to get a second passport!
With the weather so unpredictable in Europe, we will soon be headed back over to the Caribbean. Next month we are planning fresh new, on-the-ground updates on the Dominican Republic residence and second passport program, as well as the scoop from diver’s paradise San Pedro, Amergris Caye on Belize’s superb new offshore LLC laws that will soon be giving the established offshore LLC leaders Nevis and Cook Islands a run for their money! So, make sure you are signed up to our free Q Bytes newsletter, and if you have friends who are interested in this topic please be sure to tell them to google Q Wealth Report and follow the free Q Bytes sign-up link!
This week we have several important items of news for you… starting with even more evidence of the need for a second or third passport. We had already been planning our new report on Dominican Republic’s changing citizenship laws when the US announced that it is suspending freedom of travel rights for those who are in dispute with the IRS! That’s right, if this bill becomes law then the USA will join the list of countries like Cuba and North Korea that do not automatically issue passports on demand to their citizens.
As has become the norm, this controversial proposal was buried inside other legislation – Senate Bill 1813 to “reauthorize Federal-aid highway and highway safety construction programs, and for other purposes”.
In addition to authorizing appropriations for federal transportation and infrastructure programs, the so-called “Moving Ahead for Progress in the 21st Century Act” or “MAP-21″ includes a provision that would allow for the “revocation or denial” of a passport for anyone with “certain unpaid taxes” or “tax delinquencies”. There does not appear to be any specific language requiring a taxpayer to be charged with tax evasion or any other crime in order to have their passport revoked or limited — only that a notice of lien or levy has been filed by the IRS.
Not too many people know that the US already has an official “Passport Denial Program” in place – this one for parents with child-support arrears. In fact, when we wrote about it once before, we received letters denying that such a program existed – so here is the link. The “Passport Denial Program,” which is part of the Federal Offset Program, is designed to help states enforce delinquent child support obligations. Under the program, noncustodial parents certified by a state as having arrears exceeding $2,500 are denied U.S. passports.
Our comment: this is another terrible development for personal liberty and the presumption of innocence. Whilst we are certainly not in favour of tax evasion nor deadbeat dads, surely most of us know someone who has legitimate financial disputes during divorce proceedings, and/or who have differences of opinion with the IRS. In the old days, disputes like this were decided through due legal process. With these passport denial laws, it simply takes the say-so of a bureaucrat to deny someone a basic liberty – the freedom of travel. If there are indeed any procedures to dispute such an arbitrary decision in a court of law, they are very unclear and would require retaining a lawyer which costs tens of thousands of dollars. The potential for official abuse is enormous. The US constitution never thought of tax inspectors, most of whom don’t even have any legal background, filling the roles of judge and jury rolled into one.
Where the US leads, other countries like the UK and Australia are already thinking of following. Recently, we wrote about France wants to “do like the Americans” and start taxing its non-resident citizens on their worldwide income. The only logical way to protect yourself from such laws is to acquire a legal second or third citizenship, before it’s too late!
Q Wealth Report is your specialist and reliable source for up to date information on second and third passport programs, including economic citizenship programs like the St Kitts and Nevis program, the Dominica second citizenship program, and passport by residence systems in Latin America.