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Facebook IPO will bring big taxes. May be.
  • Eduardo Saverin, the billionaire co- founder of Facebook Inc. (FB), renounced his U.S. citizenship before an initial public offering that values the social network at as much as $96 billion, a move that may reduce his tax bill.

    Via: http://www.bloomberg.com/news/2012-05-11/facebook-co-founder-saverin-gives-up-u-s-citizenship-before-ipo.html

    Funny, isn't it?

  • 18 Replies sorted by
  • @Vitaliy_Kiselev most people will have a different take on this than me, as most people are born with and have one citizenship in life. This is obviously a tax evasion move and the US is better off without this guy. His future country of citizenship beware. He is probably hoping to save an extra 100 million on top of a billion, so I will be applauding when he is in a shithole gulag somewhere eventually. I do not know what his new citizenship is, but I know he'll always be the "american facebook guy", and God help him without that gold eagle on blue. I have held 3 citizenships in my life, and honestly it is a matter of convenience. However, I am not a billionaire, so his mileage will probably vary exponentialy :) And so be it.

  • Eduardo Saverin was born in Brazil and currently lives in Singapore. It's a big bad world, but I think he can probably afford to take care of himself.

  • Can't wait to read the next post on this forum on how Mexicans suck the US dry or similar. Polish plummers killing the UK :) Apply your local cliche here. Adolf Hitler was born in Austria, and then renounced his citizenship and responsability by shooting himself in the head. The initial IPO rush is nothing but a money laundring operation... Come on, who will invest money at xxx at share knowing it will be x tomorrow? Oh wait... Give me a break, what exactely are these people producing? A platform for apps and games? OK, that explains everything.

  • PS, and the only reason why this typical sort of behaviour is any news at all, is because it is such a blatant abdication of responsability. And yes, if we are talking such amounts of money, abdication is an appropriate term. The things will only get interesting when they try to outsource the "shield" ei nuclear weapons. People are and will be sheep, but there will always be wild cards and non conformists to make things a bit more interesting.

  • Citizenship shell games are something the super rich partake in. Nothing new here.

    I'm not a professional investor, but I did witness the AOL/Time debacle. I also lost a lot of money in IPO for etoys. I wouldn't touch the shares because FB doesn't make anything. They can't even create content and their targeted ads on my FB sidebar couldn't be further off the mark for my interests. And btw, I thought MySpace was the next big thing?

    ps if anyone wants to add me up on FB, brian_luce At hotmail

  • I was in the internet before it was called internet. I partecopated to BBS, to online text RPGs, I witnessed the ascii nipples of Lenna coming out of the white-and-grey-lines-perforated printer. Rise and fall of VAX, IBM and Olivetti supercomputer. Making videos and manipulating images on Indigo, Amiga etc.

    Never been on facebook, and will never be. I flew from linkedin, I do only have a personal mail adress. My citizenship is italian, but I do feel european, feel home from Lisboa to Tallin, to Istambul. I do not give a dam about Severin, but the world we live in is done like that. Only if you have enough money, you can afford not to pay what is right... ;-P

  • So paying almost 40% taxes is "right"? Then add Social Security and Medicare it's at least 50%. No government deserves half of what you make. Period.

  • At this height the IPO cannot but fail. Who's going to buy those shares at this price? Their net income last year was like what 500m? "Morgan Stanley, JPMorgan Chase & Co. and Goldman Sachs Group Inc." Are there still people stupid enough to buy from them?

  • CRFilms Try 15%, the cap gains. He's a greedy Mofo.

  • @brianluce It's not the government's money. It's NOT our money. It's HIS money. He deserves to keep what he makes and it's not up to you, me, or any other outside force to determine how much he should make except his own industry, talent, and luck. Period.

    While I kind of like the idea of exile for those type of tax evaders, it could easily backfire. What happens if more and more billion/millionaires decide to leave AND take their money out before the legislation is passed? We already have some of the rich leaving some states like California and NY for Texas and Florida because of state taxes being too high, but at least they're still in the US. It sets a bad precedent when people would rather live outside the US because they're making more money outside the country than in.

  • Living in a civilized, organized society requires people to contribute. I don't know how to make it any simpler. This is how things have always been.

  • Right! I doubt anybody pays taxes in Somalia – unless the tax collector holds a gun to his head.

  • Nice to see Bono investing £90 Million in Zuckerberg instead of paying tax in his oh so loved Ireland

  • Freeze Saverin's Account and Sieze 99% of his assets.

  • I hate to disagree with many since I'm not a fan at how governments spend our tax dollars not in our best interest. But I read how Apple pays less than 19% in taxes by using offshore companies to collect their profits. I think they even got some governments to reclassify an Ipad not as a computer to avoid extra taxes.

    I think since the earnings and value received by the sale of Facebook stock. Developed and executed on US soil, He should be required to pay proper taxes on it.

  • @CRFilms are you being an advocate for unchecked greed?

  • Regarding this case, I am wondering about two things:

    (1) Why does it actually matter so much to this guy whether he has to pay US taxes or not? - Given the magnitude of fortune he has earned, it will be impossible for him to notice in terms of "happyness"/possibilites whether some millions more or less are in his bank account. So I guess the only plausible explanation is that he thinks whatever the US would do with his tax money would be used for a bad cause.

    (2) Why don't countries just demand taxes based on whatever turnover is made on their soil? Obviously, any multi-national corporation can evade taxes on profits. But unless a company decides not to do any business in a country, it cannot evade taxes on turnover. And by the way: Joe User, you and me, pay taxes (VAT) on turnover whenever we buy something - no matter whether any profit or loss is involved with this transaction. So it would be only fair to also tax the turnover of companies (and sure, the tax-rate as a whole could be lower if not so much would be spoilt due to inefficient use).

    PS: The facebook IPO went just as expected - again many gullible investors threw their money on a company with almost no real substance. The share price would have already dropped below its initial price if the IPO consortium had not artificially kept it a tiny bit > 38.0 - but they won't do this for long, I'd say we'll see a lower-than-initial price already within a month.

    Edit: PPS: Ok, it didn't take a month, the hype was over already on the second trading day.