Australia, a prominent immigration destination for India’s millionaires, has terminated its “golden visa” program.
This visa program known as Significant Investor Visa (SIV) was a move aimed at attracting wealthy foreign investors to the country. The decision comes after the government’s review revealed that the program, designed to stimulate economic growth, was failing to deliver the expected benefits and had become a haven for corruption.
The Significant Investor Visa (SIV) program, launched in 2012, allowed overseas investors to secure residency in Australia by investing more than A$5 million in the country. However, the government found that the scheme was not achieving its primary objectives and was instead providing an opportunity for “corrupt officials” to park illicit funds.
According to government data, a staggering 85% of successful applicants under the program were from China. Critics had long argued that the golden visa system had become a conduit for individuals seeking to conceal ill-gotten gains.
Good news as Australia’s ‘golden visa’ scheme is axed. Concerns the scheme has inherent vulnerabilities for money-laundering were raised for over a decade: https://t.co/gg2iLgC9Yo
— Transparency International Australia (@TIAustralia) January 23, 2024
Australia’s Minister for Home Affairs, Clare O’Neil, emphasised the failure of the golden visa program in a statement on 23 Jan, stating, “It has been obvious for years that this visa is not delivering what our country and economy needs.”
The government plans to replace the golden visa program with a focus on more skilled-worker visas, aiming to attract migrants capable of making significant contributions to Australia’s development and innovation.
The move has been praised by Clancy Moore, CEO of Transparency International Australia, who stated, “For far too long corrupt officials and kleptocrats have used golden visas as a vehicle to park their illicit funds in Australia and arguably hide their proceeds of crime.”
The golden visa program had faced scrutiny for its alleged loopholes and vulnerabilities. Bill Browder, known for his role in the creation of the Magnitsky Act, criticised the scheme, highlighting concerns about potential money laundering and other illicit activities.
In 2016, a government inquiry raised similar concerns, suggesting that the program had the “potential for money laundering and other nefarious activities.” More recently, in 2022, The Australian newspaper reported that members of Cambodia’s Hun Sen regime had exploited the system.
The government inquiry also found that the visas were attracting individuals with “less business acumen” than desired, while offering tax concessions that were ultimately costing the public.
While some asset managers argued that the follow-on investment from SIVs exceeded the initial A$5 million investment, the government remained unconvinced, leading to the decision to terminate the program.
Australia now joins the UK, which abolished a similar program in 2022 over concerns about the influx of illicit Russian money. The termination of golden visa schemes has also been witnessed in Malta, where an investigation revealed speedy citizenship grants to wealthy non-European Union nationals, raising alarms about money laundering, tax evasion, and corruption. The European Union had expressed concerns over the risks associated with such programs.
According to London-based firm Henley & Partners, over the past two decades, approximately 82,000 high-net-worth individuals have chosen Australia as their new home. In recent years, Indians, in particular, have shown a growing inclination towards Australia compared to the USA and the UK due to the simplified visa process.