The US government will cut the fee for renouncing citizenship from $2,350 to $450, a major relief for expatriates facing complex tax reporting burdens.

WASHINGTON: The United States will slash the fee for formally renouncing citizenship by more than 80% in a move welcomed by expatriates who have long struggled with the country’s unique tax system.

Consular fees for renouncing US citizenship will be reduced from $2,350 to $450 starting April 13, according to a notice published in the Federal Register, the US government’s official journal.

This decision reverses a 2015 price hike and returns the fee to the level at which it was first introduced in 2010.

The notice published on Friday stated the decision was made after considering “the not insignificant anecdotal evidence regarding tax-related difficulties many U.S. nationals residing abroad encounter.”

The Association of Accidental Americans (AAA), a Paris-based non-profit, welcomed the decision as the “direct result” of its legal action and advocacy.

“This fee reduction is a concrete first victory,” AAA founder and president Fabien Lehagre said in a statement on social media.

The United States is one of the few countries that taxes its citizens based on nationality rather than place of residence, a policy groups like the AAA argue imposes steep tax reporting demands on Americans living abroad and complicates their ability to open foreign bank accounts.

Under laws like the Foreign Account Tax Compliance Act (FATCA), US citizens must file extensive details on any foreign bank accounts as part of their yearly revenue declarations.

 The Sun Malaysia