The Olive Press – June 2016
Ian le Breton
By the time you read this, the UK’s EU Referendum tussle will be almost over. We will await the result of Thursday’s vote with great interest. I use the term “tussle” advisedly because, instead of a rational, well-thought out discussion, we have been subjected to a slanging match that seemed to be more about the personalities involved than the real issues. Nevertheless, one of the most enduring themes of the referendum was the attention paid to tiny Gibraltar, despite our population comparing to a small English town.
Amongst a host of other issues, the impact of a “Brexit” – or indeed a “Remain” – vote on local property prices has been a matter of keen debate on the Rock. There seem to be two schools of thought in the event of an exit. On the one hand, we were told the negative effects of Brexit would be certain to depress prices. Conversely, increased demand by those who need to live here would lead to a significant rise in housing costs. One thing is for sure, whatever the final outcome, supply is limited and Gibraltar is not going to double in size overnight.
Such thoughts have led me to consider the whole question of residency abroad. Around the world, specific programmes have been put in place in various countries to attract well-heeled mobile people, or highly skilled professionals, to their shores.
For many years, Gibraltar has operated a “high net worth” residency programme – known colloquially as “Cat 2” in deference to the relevant clause in the rules. The principal benefit of the scheme is that income tax is limited to just under £30,000 p.a. True, applicants must demonstrate a net worth of at least £2 million but all is not lost for the rest of us. Gibraltar still offers straightforward and speedy opportunities for individuals that are keen to take up residence here. Of course citizenship (i.e. a passport) takes considerably longer.
Gibraltar is not alone. For me, one of the most advantageous residence schemes in the world is not a scheme at all but simply the right afforded all EU citizens to live in any one of the 28 member states. Several EU countries have enacted special rules that allow the wealthy (or well qualified) to apply for residency. Malta and Cyprus are just two examples.
Further afield, some jurisdictions go a lot, lot further. For example, several Caribbean countries have sought to diversify their economies by offering Citizenship-by-Investment programmes. These can relate to property acquisition, investment in a business or in some cases simply a donation to the host country’s exchequer. In many cases, citizenship with a passport is available – often in double quick time.
This “second passport” option is particularly attractive for citizens whose home country might be politically unstable or perhaps in dire economic straits. Almost like a form of insurance. A further advantage offered by those former British territories is that their passports allow visa free travel to many countries; this is most advantageous to today’s “global citizen”.
As always, several important issues can arise. Taxation in both one’s home and adopted country must be considered and, of course, there’s the language, healthcare, education, legal system and accessibility to consider. And not just for the applicant but for all their dependants too. Simply upping sticks and moving to a new country is certainly not something to be taken lightly but options are available across the world and, given the right advice, the rewards can be well worth the effort. I hope that Gibraltar remains one of the best alternatives.
Olive Press Article here
