updated 2:28 PM CEST, May 24, 2023

ICYMI: American Citizens Abroad highlights its recent findings on U.S. adoption of RBT

As growing numbers of expatriate Americans are calling on U.S. lawmakers to replace America's problematic citizenship-based tax regime with a system that's based on a taxpayer's current country of residence, the Washington, DC-based American Citizens Abroad is urging expats, members of Congress and others to revisit its most-recent research report – which ACA officials say has some of the best data anywhere on the subject. 

As reported, the American Citizens Abroad Global Foundation (ACAGF), ACA’s sister organization, unveiled this report in April of this year.

Among its key findings was that if certain measures were taken, the U.S. could move to a residence-based tax system from its current CBT system "without the U.S. Treasury losing revenue" – which some, but not all, advocates of adopting an RBT regime argue would be necessary, in order to win the support of U.S. lawmakers, which they claim would be necessary if such a change in the tax laws were to be enacted. 

The ACA/DEG Analysis of Revenue Effects of Residence-Based Taxation study, as the ACAGF report was entitled, was more than 10 months in the works, and was based on an analysis of "publicly available information" prepared by District Economics Group (DEG), for the American Citizens Abroad Global Foundation (ACAGF), ACA’s sister organization.

DEG is a non-partisan economic consulting firm that carried out an earlier piece of research for ACAGF in 2017/2018 on the same general subject, thus providing a base upon which its researchers were able to build the new data.

In a statement on Wednesday to ACA members and media representatives, which may also be viewed on the ACA's website,  ACA said it was publishing a "new webinar to explain" the updated research data that its report, released earlier this year, contained. 

The hour-long webinar, which is dated Aug. 11 and which may be viewed by clicking here, is entitled "Digging Deeper: Analyzing the Revenue Effects of Residence-Based Taxation", and features ACA executive director Marylouise Serrato; ACA legal counsel and ACAGF chairman Charles Bruce; and DEG founder and managing director Michael Udell. 

Among the webinar's key features are the District Economic Group's Udell's explanations of the methodology his researchers used in obtaining the ACAGF report's key findings, such as an estimate of the number of Americans living abroad of just 3.9 million. This is significantly fewer than the most recent U.S. State Department estimate, of 9 million, and it matters for many reasons but especially because it significantly reduces the amount of tax revenue that the U.S. might potentially expect to collect from those expats wealthy enough to owe U.S. taxes, and thus, the amount some U.S. lawmakers might think that a move to RBT could cause the U.S. to lose out on, once double-taxation considerations and related deductions were accounted for. 

It's all about the data...

Serrato begins the ACA's statement this week by noting that her organization and the ACAGF "believe, based on our meetings with Congress and the administration, that movement is afoot to consider enactment of some type of residence-based taxation (RBT), in lieu of citizenship-based taxation (CBT)."

The ACAGF's Bruce then goes on to stress the importance of having the right data, and being able to provide it to Congress, in order that they can then "press the right buttons to make RBT a reality." 

ACA chairman Jonathan Lachowitz ends the ACA's Wednesday statement with the observation that the new "Digging Deeper" webinar represents "an opportunity to get [this data] out to a wide audience, and points out that ACA is recommending that it be widely shared on "professional and personal networks, so the community can understand how important and vital this research is".

A summary of the ACA/DEG analysis of the revenue effects of residence-based taxation, published in April, may be read by clicking here.

To read and download a nine-page, "Side-by-Side Analysis of the Proposed RBT Regime and the Current U.S. CBT Regime", click here.

ACA has said that it is happy to answer any questions individuals as well as other organizations involved in advocating on behalf of U.S. expats might have about its research findings.