Opportunities and Challenges for Immigration to Overseas
Over the past yea r, domestic economic development has been stable, and the Chinese high net worth population has increased steadily, according to the Immigration and the Chinese HNWIS 2018 released by the Hurun Research Institute, in association with Visas Consulting Group recently.
According to the Hurun Chinese Luxury Consumer Survey 2018, about 37% of HNWIS (those with family assets worth USD 1.5m to USD 31m) respondents are currently considering immigration, a 10% drop compared with last year. 12% of them have already emigrated or are applying to do so.
From the international perspective, many traditional and emerging immigration destinations are implementing various stimulus policies, including the United States’ substantial reduction in corporate tax and simplified property purchase immigration policies in a number of European countries.
David Chen, partner lawyer of Visas Consulting Group, said, “From the survey, we can see that visas and overseas property purchases have become the new guarantee of economic security for Chinese HNWIS. It is worth mentioning that Ireland has become a dark horse this year with its high-quality education system and low corporate tax rate of 12.5%. Furthermore, along with the recovery and continued development of its economy, Greece provides one of the best choices for investment immigration, allowing investors to obtain immigrant status and substantial property investment income at a low cost.”
As China officially launches the CRS global taxation program, immigration needs are constantly being extended and redefined, in addition to the traditional demand for education, welfare and travel convenience. Demand for overseas asset allocation and obtaining residence is now leading emerging migration trends. Some investors put gaining residence overseas at the top of their agenda and focus on passport immigration. With the implementation of China’s Belt and Road Initiative, changes in taxation pertaining to global investment immigration, and the shifting international outlook, realising a globalised allocation of investment and identity means that investment cannot be limited to domestic stocks and property.
Which cities for overseas property purchase are more popular?
The Visas Consulting Hurun Report Chinese Immigration Index 2018 ( CII 2018) based on the eight categories of education, investment destination preferences, immigration policy, property purchasing, personal taxation levels, medical care, visa-free travel and ease of adaptability.
Rupert Hoogewerf, chairman and chief researcher of Hurun Report, said that there are some highlights in the Report, for example, “London has risen rapidly to become the sixth most popular destination for purchasing overseas property, overtaking Vancouver, Toronto and Melbourne for the first time. Emerging immigration destinations Ireland and Greece performed well, with Ireland moving up four places to third, and Greece occupying sixth place in its debut appearance on the ranking. Canada falls two places to fourth, while Australia is down one place to fifth. It is also interesting to note that 90% of those
As China officially launches the CRS global taxation program, immigration needs are constantly being extended and redefined, in addition to the traditional demand for education, welfare and travel convenience.
considering immigration intend to live in China after retirement.”
The United States topped the rankings for the fourth year running with a score of 8.7. In terms of individual factors, the American education system remains one of the main reasons Chinese investors most favour the United States. In addition, it came top in terms of visafree travel and ease of adaptability. President Trump’s tax cuts also saw it score 8 points higher in the tax category this year.
The UK climbed from third place to second with a score of 8.5. Despite the UK being set to leave the EU, London remains one of the world’s leading financial centers, and British education is regarded as second only to that of the United States. Investment immigration to the UK comes with the benefits of one’s children enjoying an elite British education, and of the family gaining access to its high quality medical and welfare systems. Furthermore, a favourable exchange rate makes investment in the UK more attractive. Rupert Hoogewerf said, “Brexit has had little impact on Chinese entrepreneurs. At present, British property represents good value, with uncertainty over Brexit and the weakness of the pound making it relatively cheap.”
With its youthful demographics and a diverse range of advantages, Ireland has moved up by four places to third place with a score of 7.9, becoming the dark horse of the immigration industry. Ireland, conveniently located in the west of Europe near the UK, boasts a beautiful natural environment and strong social welfare, in addition to a low tax burden. It also has a strong knowledge-based sector, and is a world leader in cutting- edge high-tech fields such as computer science.
Canada falls two places to fourth with a score of 7.8. At the end of March 2018, the Quebec Immigration Bureau raised the threshold for investment immigration, upping the net family assets required from CAD 1.6 million to CAD 2 million, and the total investment from CAD 0.8 million to CAD 1.2 million. Furthermore, the number of annual quotas granted remains limited. This, along with the strict auditing standards of its immigration authorities, accounts for Canada’s fall of two places.
Greece arrives at sixth place in its maiden entry, with a score of 7. There has been close cooperation between China and Greece under the Belt and Road Initiative, providing a timely boost for Greece’s economy. With the recovery and continuing development of its economy, Greece provides one of the most cost-effective investment immigration projects among those on offer in Europe, allowing investors to obtain Greek resident status and substantial property investment income. This makes Greece an optimal choice for Chinese investors.
Portugal is down one place in seventh with a score of 6.7. Spain remains in eighth with a score of 6.5. Portugal and Spain’s immigration policies make no demands on language, education, business background or funding. Residence requirements are also quite relaxed, allowing investors to purchase property and process immigration in a single step.
Malta moves down by 4 places to ninth with a score of 6.4. Cyprus takes tenth place in its first appearance on the ranking. Demand for overseas asset allocation and obtaining residence is now leading the emerging migration trends. Cyprus does not levy inheritance or dividend tax, among others. Passport holders enjoy visafree access to 171 countries and regions around the world, which provides HNWIS with comprehensive asset allocation and residence solutions. For savvy investors, Malta and Cyprus are cost- effective, low-risk choices offering significant returns, making them popular destinations.
The top five cities for overseas property purchase among Chinese HNWIS remain unchanged from last year. Los Angeles is the most popular for the fifth year running, while New York climbs from the third place to second. Boston is up two places to third. San Francisco remains fourth, tied with Seattle, which falls two places. Greece enters the top ten for the first time, while London leaps eight places to sixth.
The emerging immigration trends: immigration for wealth, tax and property
For Wealth: increasing holdings becomes the trend ‘ Foreign exchange deposit’ and ‘ immovable property’ are far the most popular overseas investment options, exceeding others with proportions of 43% and 30%, and they are set to remain their options of choice over the next three years. In addition, insurance and standard financial products will increase by 10% and 9% respectively over the next three years, while art investment will decrease by 3%.
HNWIS’ financial investment outlook has become