Boris Johnson and US citizenship: Committed To Britain And Cheerio To America

By Expat News

A final “Cheerio” was offered by the Mayor of London, Boris Johnson at the end of his 6-day visit to America. Born in New York, Mr. Johnson has had a dual citizenship after his family relocated to the UK when he was 5 years old. He has committed himself to Britain, a country he declares to be “the most congenial business environment in the world.” A statement he made during his trip to the US promoting Britain at a trade show.

This came after a battle Mr. Johnson had with the IRS regarding taxes they claimed he owed from the sale of his house in the UK, reportedly over $153,000 (£100,000). He has recently settled his debt with the IRS but only after making headlines about his strong dislike of the American tax system.

Why Boris Johnson renounces US citizenship?

With political ambitions, it is no doubt that Johnson will need to take care of his public image going forward. American citizens and Dual citizens are required to pay American taxes on income received anywhere in the world. While most, if not all, affected by this law aren’t happy about it, Johnson has not been shy about expressing his disdain about the matter. Even with foreign tax credits and treaties, the American taxes are significant and it is believed that many Americans leave their US citizenship behind because of that.

“It’s an accident of birth that has left me with this thing. I’ve got to find a way of sorting it out.”, Mr. Johnson was quoted in the Sunday Times. This “thing” he refers to is the capital gains tax bill he received from the IRS for the sale of his home in London. Johnson stated that it was outrageous to be charged taxes by the IRS when he hasn’t lived in America since he was 5 years old.

Many wonder though if giving up his American citizenship is all about the taxes. Some believe it is his future political aspirations where a dual citizenship could be an obstacle. It is known that Johnson has plans in the next general election to run for Parliament. During his appearance in 2012 on “The Late Show with David Letterman”, Boris did admit he was American and was quoted as saying “a fact I’m trying to conceal to the London electorate.”

When questioned by Letterman about the rumors of Johnson possibly becoming Britain’s next Prime Minister, he laughed and said “I’ve as much chance of being reincarnated as an olive.” During his interview with Letterman in 2006, Johnson did acknowledge to Letterman, “As you’ve already pointed out, I could be President of the United States… technically speaking.” Now that he has renounced his American citizenship though, he is no longer able to run for America’s highest office.

AOL’s former president, Joanna Shields accompanied Johnson’s recent visit to the US. She too has a dual citizenship of American-British and is now the advisor to David Cameron, Britain’s current Prime Minister. Johnson was busy while here meeting with Washington leaders, boosting the Boston Olympic bid and was mistaken as Donald Trump while in New York.

Even though Johnson was quoted as far back as 2006 as saying “What I want is the right not to have an American passport.”, he is the image of a true American. He is ambitious, charismatic, profane and self-confident. His skeptisim of authority and upward mobility personality makes him a picture perfect New Yorker by many opinion.

Because Johnson was born in New York City British parents, he was automatically an American Citizen. Therefore, when he sold his London house, making a profit of £730,000, the IRS sent him a bill. While the amount of the tax bill has been stated at £100,000, those closest to Johnson claim it was much less.

And that is where the feud between Johnson and the IRS began. From the very beginning, Johnson refused to pay saying, “No, is the answer. I think, it’s absolutely outrageous. Why should I?” He would continue on saying “…. I think, you know, I’m not a—I, you know, I haven’t lived in the United States for, you know, well, since I was five years old.”

So is it the issue with American tax laws and Johnson’s dislike for the IRS that inspired his renouncement of his American citizenship? Or is it his political aspirations in Britain creating the need to be right with the law? Some would say it is a combination of both.

Even for the steadfast advocate of confiscatory taxes, the case with Johnson and the IRS is a sympathetic one. It is clear that Mr. Johnson has the intentions and purpose as a Briton. The collision of these two American laws is unusual. The first law affecting Johnson by being issued a passport at birth and the second law that regardless where American’s live and have an income, they are required to pay American taxes. According to The Wall Street Journal, that isn’t a universal practice.

Other American citizens have found themselves in the same situation. Other American expats have complained about the unfair penalties by the IRS and how conflicting and confusing the tax system is. Many have unintentionally underpaid because the laws are so difficult to understand.

After the law went into effect in 2010 that allows the IRS to collect more information on bank accounts belong to Americans, more have renounced their American citizenship. Over 3,400 did so in 2014, a 37 percent increase from the year before according to Bloomberg.

Johnson’s tribulations with the IRS and dual citizen are not his alone. Another high-profile case with the IRS was with Eduardo Savern, Facebook co-founder, whom politicians scorned. Winston Churchill, whom Johnson has a published biography, also had American connections. However, Churchill was born prior to the law in 1934 that gave babies born in America an automatic passport.

Like others with wealth that try to keep as much of their wealth as they can, in America, few have sympathy for them. One would think that deciding between birth country and bank account, birth country would win, But alas, Johnson is not alone. As money talks, American’s with dual citizenship, walk.