American Citizens Abroad, an expat advocate group, said it has submitted a detailed proposal concerning taxation of Americans abroad to the Senate Finance Committee on International Tax Reform.
The major proposal is for residency-based taxation. That is, U.S. citizens abroad would not be taxed at all on their foreign income.
The organization also called for a streamlined, comprehensive and non-punitive compliance program for those Americans already residents overseas who have not been reporting compliance under present citizenship-based tax rules.
Residency-based taxation is the reason the U.S. government is seeking information about its citizens from foreign financial institutions. This has caused problems for U.S. expats.