The United States is set to slash the cost for citizens who wish to formally give up their nationality by over 80 percent, a change that has been warmly received by “Accidental Americans” who find the U.S. tax system difficult to navigate.
Starting April 13, the consular fee for renouncing U.S. citizenship will drop from $2,350 to $450, as stated in a notice from the Federal Register, the official journal of the U.S. government.
This adjustment undoes a price increase from 2015 and brings the fee back to the original amount set when it was first introduced in 2010.
The decision followed a review of “the not insignificant anecdotal evidence regarding tax-related difficulties many U.S. nationals residing abroad encounter,” according to the notice released on Friday.
The Association of Accidental Americans (AAA), a Paris-based non-profit, celebrated the news, calling it the “direct result” of their advocacy and legal efforts.
“This fee reduction is a concrete first victory,” AAA founder and president Fabien Lehagre said in a statement on social media.
Because the United States taxes its citizens based on their nationality rather than where they live, groups like the AAA argue that Americans abroad face heavy tax reporting requirements that can even make it difficult to open bank accounts.
Under regulations like the Foreign Account Tax Compliance Act (FATCA), U.S. citizens must provide detailed information about any foreign bank accounts along with their annual income tax filings.
