Al Costlow, Singapore

posted 19 July

"Given the tax increase the American manager will be much less competitive; as a company we will put extra effort into finding qualified non-Americans. Tax burdens on expats and the companies they work for will eventually eliminate American managers form the international workforce.

The United States will not be represented directly by American citizens in the international business world; there will no longer be a network of Americans active in the international community. This cannot be good for our country."

Bret Willoughby CPA, Willoughby CPA LLC, Madison, Wisconsin

posted 13 July

"I am a CPA that prepares tax returns for 175 overseas Americans... According to the IRS about a quarter of overseas Americans work for not-for-profit organizations like development agencies, international schools and religious not for profits that do not “equalize the foreign taxes.” These Americans typically earn US$25,000-50,000... The IRS says the biggest problem with overseas Americans is non-compliance or non-filers. TIPRA encourages overseas Americans to be non-filers...

I have one client from Sen. Grassley’s home state of IA who earned US$25,000 as a teacher in Asia. When she came home to visit and then bury her mother in IA her employer had to include that income in her taxable income. Her limited savings are going to be taxed now in the US.

The Senate Finance Committee press releases assume that the overseas American can take both the Foreign Earned Income Exclusion and the Foreign Tax Credit. This is wrong. Most Americans living overseas make under the US$80,000 and don’t take the foreign housing allowance and can not take the foreign tax credit once they start taking the Exclusion.

This was a bad provision of TIPRA."

“We are a small business enterprise, trying to expand our presence in the region. We export engineering consulting services project developer in the power, energy, environmental, and mining sectors. We are trying to grow our business and competing against primarily British and Australian firms. Those firms have lots of lower wage Chinese and Indian employees that we have to compete against. Why is the government trying to discourage American from working abroad? The US needs to be motivating people to reduce the trade deficit and improve the economy rather than reducing the incentives.

With regard to taxation on items such as schooling, relocation, and housing expenses, these are benefits that I see a zero net net financial gain. Plus, even if we chose to, my daughter would not be allowed to attend public schools in Singapore because of the differences in curriculum between the U.S. and Singapore school systems."

”I am a retired US Commissioned Medical Officer with one-year old triplets, now working full-time in a non-profit, Singapore healthcare organization which provides development assistance to less well-developed countries in the Asian region…. that contributes to US security through strengthening capacity for medical and public health preparedness and response to emerging and re-emerging infectious diseases. I have a simple contract for salary and a small housing support allowance, but none of the other employer-funded benefits that usually accompany an ex-pat "package" (i.e., no education benefits, no major medical or life insurance benefits, no pension plan, no cost-of-living or other wage supplements). For me and my family, a change in the US income tax laws as described in your email might force me to leave Singapore or stop doing the not-for-profit development assistance work that I do which would have a negative effect on US and Global Health Security.

I hope the adverse provisions of this tax proposal/law can be eliminated or appropriately modified.”

The Dean of the Faculty of Business at the City University of Hong Kong tells the American Chamber of Commerce in Hong Kong that he had recently been to the U.S. for an annual recruiting trip to hire American faculty members. He had found potential recruits deeply concerned about the effect of the tax law changes on their compensation. (As all universities in Hong Kong, City U provides a housing allowance as part of its compensation to faculty members because of the high cost of housing here.) He had never run into so many questions in the past, and after doing their sums, several of the potential faculty members he had offered jobs to had declined because of the uncertainty and fear of increased tax burden.

The Dean went on to say, with obvious regret, that he was having to increase recruitment in the UK and Australia, whose expat professors do not suffer tax disadvantages from coming to Hong Kong. He noted that typically, 50-70 per cent of the Business Administration faculty has come from the U.S. in the past, because Business Administration was an area where the U.S. excelled. He expected this number would go down this year, and continue to go down in the future unless US tax law was revised to remove the huge tax penalty that American faculty members now faced.

This is a field (Business Administration) where the US has historically excelled, where the Dean WANTS to hire more Americans, and where the students are sympathetic to Americans and to the United States. As a result of this tax change, increasingly in the future they will be taught by nationals of other countries, and see other countries, not the U.S. as the example to regard.

Another blow to U.S. competitiveness. How many times does this have to be repeated before our global influence suffers a killing blow?