A preemptive strike against Americans who may be poised to flee an impending Obama administration’s tax-and-spend policies?

You probably didn’t notice this little provision inserted into the Heroes Act of 2008, passed by Congress on June 17.

The headlines in the press release about the law were about the increased benefits for veterans and families of deceased military.

But Richard Kohan of Price WaterhouseCoopers drew my attention to one section of the act—the portion that states anyone voluntarily giving up his or her citizenship will be taxed on ALL of his assets as if he or she had sold them—paying capital gains on assets that have increased in value, even though they have not been sold!

That’s right. While everyone in the media is focused on keeping aliens out of America, Congress has voted to lock its citizens—or at least a good portion of their assets—into—America! Maybe they’re thinking that patriotism won’t be enough to keep the smart money from recognizing the coming increases in the tax burden.

Ask yourself: What revenue need in the government does this tax serve?  If your answer is “I don’t know” you begin to see why taxation for any purpose other than raising revenue necessary for government is a very bad thing.

By allowing politicians to pass things like “sin” taxes into our tax code for the purpose of deterring certain types of behavior - or passing tax exemptions and deductions for things like buying a hybrid vehicle to encourage certain types of behavior - we’ve opened the door to politicians being able to control us through taxation.

A sort of back door tyranny.  The founders never intended that government should dictate to us what vehicles we can drive, etc. but by using the power of taxation the government can exert that control anyway, albeit in a more limited sense.

We should demand that the tax code be simplified, and that taxation be limited to revenue-raising purposes only and not bouts of social engineering or outright attempts to deny citizens the liberty to move as we see in this instance.