On May 17, 2006, the U.S. Congressional Joint Committee on Taxation approved a provision that would raise the taxes of Americans living abroad.  The new policy could force expatriates with high salaries to pay thousands of dollars more in taxes each year.  The new taxes are retroactive as of this year.

Expatriates living in countries with high housing costs and low taxes, such as Hong Kong and Singapore, will be the most affected.  Experts predict that expatriates who make about $140,000 in base pay will see an increase in taxes from about $10,000 to $20,000 per year.  Large companies will most likely cover the higher tax burden for their employees.  However, it is likely that some companies will begin to rethink hiring American expatriates, and instead, hire expatriates from other countries that do not have such high taxes.  Some American expatriates have already expressed concern that their employers will not indemnify them against the higher taxes.

Because of this sudden change, many American expatriates living in Asia will need to rethink their plans to live and work in the region.  David Sutherland, from the American Chamber of Commerce in Hong Kong, commented, "Lots of people are mighty unhappy out here and this will be huge for some people and will cause many Americans to return."