Portugal, renowned for its allure to foreign investors, has recently undergone significant legislative transformations affecting its investment landscape. The alterations to the Golden Visa and the proposed amendments to the Non-Habitual Resident (NHR) regime have sparked questions about the country's ongoing viability for international investors.
As of October 7, 2023, the Golden Visa underwent substantial modifications, eliminating real estate and capital deposit avenues for new applications while introducing new investment modalities. Simultaneously, the 2024 State Budget Proposal is under parliamentary scrutiny, foreseeing changes to the NHR regime.
The removal of these pivotal programs begs the question: Does Portugal still stand as a compelling destination for foreign investment?
This redirection, estimated to attract approximately €5 billion over the next decade, presents a unique opportunity for economic rejuvenation. The shift from real estate to OIC investments (Collective Investment Organisations) promises a more sustainable and structurally beneficial injection into the Portuguese economy.
Beyond the economic infusion, investing in OIC not only grants access to the Golden Visa regime but also offers attractive tax and financial returns. OIC participants benefit from a special tax regime, featuring incentives and exemptions, providing an additional layer of appeal.
While the proposed changes to the NHR regime may seem restrictive, a transitional provision allows existing applicants and those meeting specific criteria to continue benefiting from the program. The revised NHR conditions, although more stringent, particularly for scientific and academic activities, preserve a level of continuity for eligible individuals.
In essence, Portugal's allure for foreign investment endures, though the modified Golden Visa and NHR regimes introduce substantial changes. The impact on the market remains uncertain, but early reactions suggest a positive reception. Despite increased competition from other European jurisdictions, Portugal's intrinsic appeal remains strong, rooted in a multitude of factors that continue to attract international investors.
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Written by Joseph Farodoye for Bluxe Century
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