As we approach the July 4th holiday that inspires our most patriotic thoughts, it’s hard to imagine that any American would voluntarily give up his or her citizenship. But perhaps the politicians are starting to understand that the taxpaying public is growing wary of being fleeced, either through increased taxes or the stealth tax of inflation, as a way to repay all the debt that Washington has incurred. And in preparation for the possibility that Americans might rebel at the debt and taxes incurred by their government, they’ve just passed a new law that will stop your capital — or at least a good portion of it — at the border, should you decide to leave. 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.

Don’t you just love the way they slip these laws right past your nose. I mean, who would argue with something called the Heroes Act?