Wednesday, August 22, 2012
Eduardo Saverin, a co-founder of Facebook, has abandoned his American citizenship ahead of the social networking company's possibly oversubscribed IPO in May (since not entirely successful but he will have got his money)
“Eduardo recently found it more practical to become a resident of Singapore since he plans to live there for an indefinite period of time,” his spokesman Tom Goodman told Bloomberg.
Brazilian-born Saverin made the initial investment of $1,000 in Facebook when he and Zuckerberg were students together at Harvard...
Singapore has no capital gains tax, so renouncing his citizenship ahead of the IPO is a very smart idea, according to Reuven S. Avi-Yonah, director of the international tax program at the University of Michigan’s law school. "Once it’s public you can’t fool around with the value." He'll still get a hefty bill from the IRS, but it shouldn't be too hard to swallow.We have long had European tax exiles living in Monaco & their like. We have also had rich people from the 3rd world setting up homes here (for example an extraordinary number of Bollywood stars choose to live in Britain).
This shows that the trend is not one way. Singapore is by no stretch of the imagination a 3rd world country today. However it used to be. It is also one of world's most heavily populated areas with no natural resources or indeed natural beauty (it has a lot of wonderful sights but all man made). The super rich don't just choose where to live because of the taxes - after all at that level money is just numbers whereas luxury is lifestyle.
Indeed if it weren't for the fact that it isn't floating Singapore would be a Victorian seasted - An island with few inhabitants the Victorians built into a major city & whose own inhabitants have built it into a major world city.
If that can be done there it can be done anywhere.
Within our lifetimes we may see the rich and talented no longer living in California, New York, London or even Aspen (itself a city that deliberately built itself into a home for the rich) but on ocean seasteds, permanently cruising ships, orbit, the Moon or L5 colonies. The important things will be (A) are they attractive places to live & (B) taxes (in that order).
On one point the space orbital, Lunar and L5 settlements will have one unique selling point - low or zero gravity. We don't know if low gravity will slow ageing, though it is not unlikely. However it will certainly make it more comfortable and falls, a major cause of incapacity in the elderly, will lose its terrors.
Will Mr Saverin eventually retire to an O'Neill colony with a particularly low spin? I wouldn't bet against it. Will the money from others like him be invested in space and seasteds as soon as they look like comfortable places to live? That I would bet on.