Mt. Vernon Register-News

Opinion

June 21, 2014

'Bitcoin Jesus' gives bad tax ideas

Roger Ver, a computer-parts and explosives impresario known as Bitcoin Jesus, has come up with a pretty Bitcoiny idea: Give him some Bitcoins and he’ll set you up with a passport and citizenship in the Federation of St. Kitts and Nevis, ostensibly free of income taxes, bad weather and meddlesome governments.

Sounds great! Ask nothing, expect nothing, etc ... In reality, though, this isn’t a very good idea for either government-hating types or aspiring tax avoiders. And it’s hard to think of too many other constituencies that might be interested in using Bitcoins for such a service.

Let’s say you’re a government-hater. A really ambitious one, determined to escape Uncle Sam and the Fed’s sinister intrigues. So you convert a lot of money to Bitcoins, retain the services of Ver’s company and pack your bags for a life of Caribbean emancipation. Two challenges suggest themselves.

One is that things will get pretty expensive. You have to buy $400,000 worth of government-approved real estate on the island as part of its citizenship-by-investment program, plus some expansive fees. Or you could donate $250,000 to something called the Sugar Industry Diversification Foundation, which, whatever its merits, doesn’t sound like an exemplar of free-market enterprise. Then Ver’s company takes its cut. So that’s kind of a lot of Bitcoins, even if you’re a highly prosperous government-hater.

And two, for all that, you’re not exactly moving to a bastion of libertarian purity. You’re moving to a place with a high tolerance for public debt, international bailouts and monarchical subjugation.

For an example of the bureaucratic milieu, consider this handy guide from the St. Kitts Citizenship by Investments Unit: “The first step for applying for Citizenship is choosing an authorised person from the list of the Authorised Persons. The second step is contacting your chosen Authorised Person.”

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