Second Citizenship on Sale in the Caribbean
In September, hurricanes Harvey, Irma, and Maria devastated the Caribbean region.
The billions of dollars in damages have spurred price reductions for the citizenship-by-investment programs (CIPs) in some Caribbean jurisdictions.
Here’s a rundown:
St. Kitts & Nevis Have Cut Fees by as Much as 50%
Before the September hurricanes, the Federation of St. Kitts & Nevis CIP offered two options:
A non-refundable contribution to the Sugar Industry Diversification Fund (SIDF). This foundation was set up in 2006 to benefit sugar workers who were displaced by the end of commercial sugar cultivation. The contribution required for a single applicant was $250,000. The contribution required for a primary applicant, spouse, and up to two qualified dependents (i.e., children under the age of 18), the cost was $300,000.
An investment of $400,000 or more in qualifying real estate in the Federation. Most newly built real estate qualifies for the CIP. In addition, a registration fee of $50,047 applies to the primary applicant and $25,047 for each qualified dependent.
In both cases, due diligence and legal fees add $25,000 or more to the total cost.
After hurricanes Irma and Maria caused significant damage in the Federation, the St. Kitts & Nevis Citizenship by Investment Unit (CIU) announced a temporary price reduction for the SIDF option. Until March 30, 2018, the SIDF price will be only $150,000 for any applicant with up to three qualified dependents (e.g., spouse and two minor children). Additional qualified dependents will cost $25,000.
These price reductions mean that the cost of applying for St. Kitts & Nevis citizenship for a family of up to four persons has now fallen by 50%. Until this offer expires, St. Kitts & Nevis has the most affordable family contribution option of all of the Caribbean CIPs. But you have to start the application process now.
Dominica Reduces Processing and Due Diligence Fees
Dominica suffered the worst effects of the September hurricanes. Maria made a direct hit on September 18 as a Category 5 storm packing 160 mph winds. The storm destroyed or heavily damaged more than 90% of the buildings on the island and led to at least 27 deaths.
In the aftermath of Maria, restoring government services became a priority. Things are slowly improving, but a great deal remains to be done.
To give prospective citizens an incentive to choose Dominica, the unit overseeing the country’s CIP announced it would reduce the application fee from $3,000 to $1,000, the due diligence fee for the spouse of the primary applicant has been reduced from $7,500 to $4,000, and the naturalization fee has been reduced from $750 to $250.
The costs for the program options have not changed:
A non-refundable contribution to the government of $100,000 for a single applicant; $175,000 for a primary applicant and spouse; and $200,000 for an applicant, spouse and up to two qualified dependents.
An investment of $200,000 or more in qualifying real estate. In addition, a registration fee of $25,000 applies for each applicant.
As with St. Kitts & Nevis, due diligence and legal fees add $25,000 or more to the total costs. (The Nestmann Group is the only licensed provider for the Dominica CIP in the US.)
Another Recent Price Reduction
One of the Caribbean region’s newest CIPs is that of St. Lucia, which came into being in 2015. To make its program more competitive, the government reduced the cost of the contribution option from $250,000 to $100,000 for a single applicant in January 2017. Now St. Lucia and Dominica are tied for the most affordable contribution option for a single applicant.
A price reduction also was announced for St. Lucia CIP applicants accompanied by a spouse (from $235,000 to $165,000) and for families up to four people (from $250,000 to $190,000.
Is Second Citizenship for You?
The advantage of a second citizenship and passport boils down to one core principle: freedom.
Your passport is the property of the government that issued it. If your government decides it doesn’t want you to travel internationally, it can simply revoke your passport, leaving you trapped in that country. If you’re a US citizen, keep in mind that the State Department will revoke your passport if you have a “seriously delinquent tax debt.” If that happens, you won’t be able to leave the US. And if you live outside the US, you won’t be able to leave that country. Indeed, without a valid passport, you might even be deported to the US.
There are numerous additional benefits to a second citizenship and passport:
A haven in the midst of political instability at home. A second passport gives you the right to live permanently in another country. That’s especially valuable if your country becomes a totalitarian hellhole.
Expanded residence options. A second passport may entitle you to live in other countries as well. For instance, a passport from St. Kitts & Nevis, Dominica, or St. Lucia gives you the right to live and work not only in the country that issued the passport, but in any other member of the Organisation of Eastern Caribbean States. The other members of this group are Anguilla, Antigua and Barbuda, the British Virgin Islands, Grenada, Martinique, Montserrat, and St. Vincent and the Grenadines.
Expanded travel options. Even a citizen whose passport usually allows easy international access can find a visa denied due to travel restrictions, trade sanctions, or political disturbance. The US for example, restricts travel to many countries, most notably Cuba.
Lower profile. In many parts of the world, traveling with a US or UK passport can make you a target for criminals or terrorists. If you carry a passport issued by a politically neutral country such as Dominica or St. Kitts & Nevis, you'll present a much lower profile to anyone with an axe to grind against your country.
Expatriation planning. The only way that a US citizen can permanently disconnect from the US taxing authority is to give up US citizenship. And to do that, you’ll need a second passport.
Some people oppose CIPs because they believe the concept of essentially “selling” second citizenship is unseemly. But in a world with constantly increasing restrictions on freedom of movement, is it any wonder there’s a market for offering wealthy individuals this ultimate expression of freedom?
A second passport can be your key to a new world of free movement, greater flexibility, and legal tax reduction. And by acting now, you’ll contribute to the recovery after the deadliest storms to hit the Caribbean region in decades.
The Nestmann Group has helped well over 100 clients acquire a second citizenship and passport. Contact us for more information.
Protecting your assets (and yourself) against any threat - from the government, the IRS or a frivolous lawsuit - is something The Nestmann Group has helped more than 15,000 Americans do over the last 30 years.
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