With Malta about to loosen the rules as to residency and citizenship permits so as to attract high-spending persons, it may come as a surprise that according to the most recent survey of what were called 23 tax favourable locations around the world, Malta emerges as the country with the cheapest premium champagne in 5-star hotels but also as the location with a not very high quality of life.
The Knight Frank Lifestyle Report analysed 23 tax favourable locations around the world, and came out with an overall ranking, which puts Dubai at number one.
The city scored well for the number of international schools, as well as leisure pursuits and hours of sunshine. The Cayman Islands, Mallorca and Geneva came joint second, scoring consistently well across the 10 lifestyle categories.
Monaco came 10th – joint with Madrid and Moscow. Of the more established cities, Geneva was closely followed by London and Hong Kong, as all scored well in terms of education and the number of Michelin-starred restaurants.
Malta is also the place where it costs least to educate – the annual cost for a day student at an international school is around one-third of a student at Zug in Switzerland ($9,992 against $33,817).
Predictably Malta excels as to days of sunshine in a year – 300, same as Palma de Mallorca and Monaco, but then Tortola and Nassau have sunshine every day each year.
With petrol costing $1.67 a litre, Malta is around the middle of the classification, though Dubai with petrol at $0.47 a litre is obviously very far away.
What is surprising is that according to this report, Malta carries a not inconsiderable political risk, established at a 28 score, where Zug scores 5 and Moscow 54.
With a Mercer Ranking of 52, Malta is relatively high up in the classification, with Nicosia and Ottawa being classed as the cheapest with a ranking of 119 points.
The biggest surprise is in the Mercer Ranking for quality of living where Malta is classed as the fifth-worst of the lot, ranking 60 points, below Hong Kong (70), Dubai (74), Rio de Janeiro (172) and Moscow (199).
According to Tanya Powley and Lucy Warwick-Ching, who wrote about the report in last weekend’s House & Home supplement of the Financial Times, “Over the past few years, America’s investor visa programme, EB-5, has seen a surge in interest from Chinese applicants, as the country’s wealthy look to settle abroad or secure foreign citizenship.
“The programme, which grants a green card to any foreigner who invests at least $500,000 in a business that creates 10 jobs in the US, received 2,408 Chinese applications in 2011, compared with 772 in 2010, and 63 in 2006. This has helped make China one of the fastest-growing sources of international buyers for US real estate.”
Now more countries want a slice of this action. Over the past year, the governments of the debt-ridden southern European economies have gone out of their way to attract foreign residents to help stimulate their ailing property markets.
In May, Greece introduced a new law that means foreign nationals from non-EU countries, who buy a property worth more than €250,000 can get a five-year renewable residence permit for themselves and their families.
Portugal passed a similar law for non-EU investors last year. To gain residency, new arrivals need either to transfer €1m or more in capital into the country, set up a business that creates a minimum of 30 jobs or purchase a property worth €500,000 or more.
The Spanish government is also following suit with plans for a so-called golden visa that will allow non-EU residents who purchase homes priced above €500,000 to qualify for Spanish residency.