The State Department is drastically reducing the cost of renouncing American citizenship, ending a yearslong legal battle over the price of relinquishing a blue passport.
In an update published in the Federal Register on Friday, the State Department said it was reducing the consular fees of renouncing U.S. citizenship to $450 from $2,350, a more than 80 percent reduction in cost for the clunky, bureaucratic process.
The policy change, which is effective April 13, was proposed in October 2023.
The change announced on Friday returns the fee to what it was in 2010, when the State Department first instituted a charge for Americans renouncing their U.S. citizenship.
The process, which is arduous and costly, requires extensive work from consular officials, including confirming that anyone seeking to give up their citizenship fully understands the implications of doing so.
Obtaining a “certificate of loss of nationality” requires two separate interviews with consular officials, a vetting process and a formal oath of renunciation. The process can take months.
The department warns on its website that the risks of renouncing U.S. citizenship include becoming “stateless” and requiring a visa to enter the United States.
For years, the government has jousted with lobbying groups representing Americans and ex-Americans abroad, who have called the $2,350 fee exorbitant.
Among them is the Paris-based Association of Accidental Americans, which legally challenged the increased fee and sought to have the difference returned to their clients.
“This fee reduction is a concrete first victory — but our fight to have the right to renounce recognized as a fundamental constitutional right continues,” the group’s president, Fabien Lehagre, said in a statement on the group’s Facebook page.
While there are no figures showing how many Americans have formally renounced their citizenship, an estimated 9 million Americans live abroad.
For them, American citizenship can become a burden — the United States is one of only a few countries that levies taxes based on citizenship rather than geography. This means that Americans living abroad must file a tax return, and they may find it more difficult to open a bank account, because of reporting rules for foreign banks imposed by the U.S. government.
Renouncing U.S. citizenship was free until 2010, when the State Department first instituted the $450 administrative fee. It acknowledged that amount covered “less than 25 percent of the cost to the U.S. government” to process and certify loss of nationality, but kept it at that price in part to keep from discouraging those who sought to use the service.
But a sharp increase in requests — driven in part by foreign banking requirements instituted in 2010 — led the State Department to increase the fee to $2,350 in 2015, to cover the full processing costs.
But the change sparked outrage from expatriate Americans who said the new fee was prohibitive.
“Members of the public have continued to raise concerns about the cost of the fee and the impact of the fee on their ability to renounce their citizenship,” the department said in its announcement.
The State Department first announced in October 2023 that it intended to lower the fee associated with rescinding citizenship. At the time, hundreds of commenters spoke in favor of the change, with many citing bureaucratic American tax policy as the reason they hoped to give up their citizenship.
“Many reported spending hundreds or thousands of dollars a year on tax professionals, even when they might have no U.S. tax liabilities,” the State Department said in announcing the change. “Some stated that despite being required to comply with U.S. tax laws, they received and/or benefited from few of the services for which their taxes were collected.”
Ali Watkins covers international news for The Times and is based in Belfast.
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