Russian expats grapple with dual citizenship dilemma
A new Russian law criminalizing the non-declaration of foreign passports has raised fears of yet another Kremlin crackdown on opponents in the country, but Russian expatriates who are technically excluded from the statute are now scrambling to determine whether they should comply as well.
Turns out they might not be quite off the hook yet.
The law, which Russian President Vladimir Putin signed on June 4, requires Russian citizens living within Russia’s borders to declare any foreign passports or residence permits they hold, but excludes Russians “residing in Russia. permanently “outside the country of the provision.
However, hundreds of thousands of Russians living abroad could be forced to choose between disclosing these foreign ties or formally canceling their residency in Russia – a step some say they are reluctant to take due to potential bureaucratic problems if they return home.
“If I have to make a choice, I have no way of undoing my [Russian] registration of residence, ”says Ksenia, a Chicago-area entrepreneur from the Moscow region who refuses to give her last name due to the political controversy surrounding the legislation.
The law, which introduces criminal fines or community service for non-compliance, prompted Russian expats to seek clarification from their consulates abroad and on social media sites and internet forums.
Russia’s Federal Migration Service, which is responsible for collecting the information, has yet to issue formal guidance on the law, which will enter into force on August 5. Russians affected by the law have 60 days after this date to report foreign passports and residence permits.
“This issue is causing concern around the world, but there is no panic,” said Yelena Staroselskaya, president of Russian Washington, an organization serving the Russian-speaking community in Washington, DC and surrounding areas.
Staroselskaya says she has received many inquiries from Russian citizens about the law. Based on her conversations with the Russian Embassy in Washington and other sources, it appears that only Russian expats who maintain Russian residence registration are required to report, she said.
The Russian embassy said it could not comment on the details of the law’s implementation as it awaited “detailed clarification” from Moscow, adding that the embassy would make this information public upon receipt.
Dual nationality law comes amid the deadlock between Moscow and the West over Russia’s annexation of Ukraine’s Crimean territory and what Kremlin critics see as the growing seat of government mentality Russian.
Kremlin loyalists have repeatedly warned that a “fifth column” inside Russia intends to undermine the government in the interest of the Western powers. The bill’s author, State Duma MP Andrei Lugovoi, linked the law directly to these concerns last month.
“It is obvious that having dual nationality reduces the importance of Russian nationality and attitude towards one’s homeland,” said Lugovoi, who is wanted in Britain in connection with the 2006 poisoning death of the former Russian security service officer Aleksandr Litvinenko.
“This is particularly important in light of recent geopolitical events, as Russia continues to come under aggressive pressure from the West,” he added.
Ksenia, a Russian-American dual citizen, says she is not afraid to disclose her US passport because she believes the law is intended to target opposition activists or businessmen with dual citizenship living in Russia. “For me, that will probably only add boring papers for my future child, but I can survive by getting one more paper among others,” she says.
Others express greater concern about the implications of the law. “I think there is something to panic about, because if this list is compiled, then there has to be a goal,” said Anya Levitov, New York-based US Green Card holder.
Levitov, managing partner of Moscow real estate company Evans Property Services, notes that Russians are already required to disclose whether they have a foreign nationality when applying for a Russian travel passport.
In addition, she said, Russian border control officers can check whether a person has a residence permit abroad due to the lack of a visa for the country they are going to. “So it’s not about disclosure. It’s about compiling this list of, I don’t know, potential traitors or whatever they think we are,” Levitov said.
A fiscal dilemma
Russian lawmakers estimated in 2010 that around 1.6 million Russian citizens live permanently abroad, more than half of them in the European Union, Israel and the United States.
In the United States, more than 83,000 Russians obtained U.S. citizenship between 2003 and 2012, while more than 193,000 Russians obtained U.S. green cards between 2000 and 2012, according to the most recent data from the U.S. Department of Security. interior.
However, many of these expats never bothered to unsubscribe from their place of residence in Russia. On paper – namely their internal Russian passports, essential for almost any bureaucratic action imaginable in Russia – these emigrants do not appear to differ from their compatriots at home as far as their country of residence is concerned.
This can have considerable tax implications: anyone who resides outside Russia for more than 183 days in any given 12 month period is subject to a 30% tax on any income in the country, compared to a 13 percent tax for residents.
For this reason, the new dual nationality law could have substantial financial drawbacks for Russian expats who plan to conduct real estate transactions in Russia, Levitov said.
If they choose to deregister from their Russian residence and formalize their permanent resident status abroad, they could be subject to a 30% tax on the total sale proceeds. “So if you bought an apartment for $ 1 million and sell it for $ 900,000, you still pay $ 300,000 in taxes,” she explains.
On the other hand, by keeping their registration in Russia and declaring a foreign passport or residence permit instead, a person’s name will end up in a database that tax authorities could cross-check to determine if a Higher tax rate should be imposed, she adds. .
Levitov says his company is already experiencing an “increase in sales” of properties in Moscow due to the law, as well as numerous cases of foreigners in Russia transferring ownership of Moscow properties to people with Russian passports. “People fear that the required declaration will, in the long run, result in some sort of disadvantage for foreign ownership,” she said.
The waiting game
Several other outstanding questions regarding the law remain to be clarified, including whether the declaration of a foreign passport or residence permit can be made at a Russian consulate abroad or whether expatriates will have to return to Russia in order to disclose. their status.
In the absence of official instructions from the government, some Russian expats are simply waiting to see how the law will be implemented and enforced.
“My tactic will probably be to do nothing at this point, and when the law goes into effect, and maybe some consequences start to appear, I’ll just see what others are doing and what the circumstances are,” says Kirill Pankratov. , a director of engineering at a high-tech company in the Boston area.
Pankratov, a well-known Russian blogger who has had an American green card for more than a decade, says Russian expats he knows have discussed the new law but without much urgency. “Most of the time it was only mentioned briefly, like, ‘Should we be worried? Should we do something? “, He said. “And at this point, I haven’t heard of anyone – at least among my friends and acquaintances – who has done anything about it yet.”
Ksenia, the Chicago-area entrepreneur, says many of his friends also talk about the law, but most believe all political consequences will be confined within Russia’s borders.
She adds that she will be far from excited if Russian expats who wish to keep their registration at home are forced to return to Russia to declare their passports. “Then I would be angry,” she said.