Published On: Tue, Apr 9th, 2024

Big blow to expats as Spain prepares to axe ‘golden visa’ scheme | Travel News | Travel

Expats have been dealt a big blow by Spain as it prepares to axe its “golden visa” scheme.

Under the current rules, anyone non-EU citizens who invest more than €500,000 (£429,000) in Spanish property can live and work in the country for three years.

However, on Monday Spain’s prime minister Pedro Sanchez announced the scheme would be cut in order to provide affordable housing for struggling Spaniards.

He told reporters: “Today, 94 out of every 100 such visas are linked to real estate investment… in major cities like Barcelona, Madrid, Malaga, Alicante, Valencia or Palma de Mallorca that are facing a highly stressed market and where it’s almost impossible to find decent housing for those who already live, work and pay their taxes there.”

Sanchez says the goverment would unveil proposals to axe the scheme at its weekly cabinet meeting after discussing a report compiled by the housing ministry.

The golden visa programme, introduced in September 2013, aimed at bringing wealthy foreign investers into Spain to provided a much needed boost to the local economy following the financial crisis.

The EU has however urged its members to introduce strict checks or wind up similar schemes amid concerns they were inflating house prices and being exploited by criminals looking to launder money.

Portugal has already announced it will close its non-habitual resident scheme (NHRS) that rewarded foreign nationals who spend more than six months in the country. Those part of the NHRS were offered lucrative tax breaks.

Courts in France earlier this year blocked efforts to allow Brits to stay in the country for longer than 90 days without a visa.

Spain however is one of the most popular destinations for British expats looking to move to Europe.

The United Nations estimates that around 303,000 Britons lived in Spain in 2020. It was second to Ireland – with 305,000 Brits – and way ahead of France (170,000) and Germany (118,000).

The golden visa scheme has proved a hit with expats since Brexit, as it allows those with holiday homes to avoid the 90-day limit non-EU citizens can stay without a visa.

Data obtained by news outlet El Confidencial says 185 Britons have been given a “golden visa” since 2021, when Brexit came into force.

Typically Russian and Chinese property investors benefit from the visa scheme.

The criteria for a golden visa are generally considered easier to satify than other routes into Spain. The three-year residency can be extended by two years, with foreigners usually entitled to apply for Spanish nationality after a decade.

Another way to access a golden visa is by investing €1m (£858,000) in shares or funds established in Spain. It is thought this scheme would remain in place.

According to The Telegraph, it is unclear if the new rules would apply to all of Spain or just the major cities, where competition for housing is at the worst.

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