[cc62cf4a4f20]

I'm unsure how strange this is. As a Canadian, when I left the country I had to undergo what's termed a deemed disposition - i.e., pretend you sold all your assets and then pay the relevant taxes on the net gains you've enjoyed to that point. This includes proposing a value for any companies that are not publicly traded. See: https://www.canada.ca/en/revenue-agency/services/tax/interna...

[somedude895]

So if all your money is tied up in your company you have to sell part of your business in order to be allowed to leave the country and by the way thanks for creating all those jobs? Sounds slightly CCP to me.

[LadyCailin]

I know of at least 4 countries that have exit taxes, and while the US doesn’t have an exit tax if you simply move abroad (it does if you renounce citizenship) it has other very punitive taxes for expats. So, it isn’t a unique thing to Germany or, assuming you’re correct, China.

[blitzar]

> US doesn’t have an exit tax if you simply move abroad

The US doesnt have an exit tax because, for the purpose of taxation, you can't leave.

[knorker]

It should be added that the US taxes you worldwide even after you leave, so I would file the US as even worse in this regard.

In that they tax you when you stop being tax "resident", just like the others.

[piker]

It's not that it has punitive taxes for expats, it's just that as a US citizen, the US doesn't care where you live -- you're subject to US tax. It has rules for everyone that prohibit deferring income taxes which implicate non-US tax-opaque entities, but that's not so much of a capital gains concern as a timing issue.

It's much simpler in many ways, although it creates its own issues with juggling tax treaties and realization timing.

Forcing you to pay a tax on unrealized gains is anathema to the US system, and would definitely burden founders to the extent they'd be well advised not to form in that jurisdiction in the first place.

[LadyCailin]

PFIC taxation, of which some pension accounts qualify, as well as all mutual funds and ETFs, is absolutely punitive, and does in fact charge taxes on unrealized gains. Even if you don't have any PFICs, or even owe taxes to the US, the fact that you need to pay an accountant ~$500+, just to file the taxes, is in my opinion punitive as well.

[piker]

Well there are actual realizations in the ETF and mutual fund context, and the market has simply decided that structure still works for the commingled investments of US taxpayers. PFIC taxation I concede is a head-scratcher, but it's somewhat orthogonal to the capital gains issue. The big take home is that the US wants tax on all of your income, and it doesn't want you hiding any of that offshore. I'm an expat who deals personally with the last issue, and again I agree it's quite frustrating, but that's not what punitive means. That's just the type of frustration that arises when one is required to synchronize one or more complex systems.

[csomar]

China doesn’t have an exit tax.

[hollerith]

China doesn't allow its citizens to send or invest money abroad hardly at all. Yes, this means that most of the Chinese who bought houses in the US and Canada were breaking Chinese law.

One cause of China's real-estate bubble was too much (domestic) savings chasing too few investment vehicles.

To learn more, read up on financial repression in China.