Simon Hunter
THE Socialist-led Spanish government will take the first step today toward scrapping the country’s ‘golden visa’ scheme, which was introduced in the midst of a financial crisis in Spain in a bid to attract wealthy investors to the country.
Under the scheme, around 15,000 foreigners have secured residency permits in Spain after having invested more than half a million euros in the country’s economy.
The problem for the administration of Prime Minister Pedro Sanchez, however, is that the majority of these investments have been in real estate – in particular in Spanish cities where prices are already sky-high and access to affordable housing is a major issue for locals.
The amendment to the Public Service of Justice Act, which was passed by the government of Mariano Rajoy of the conservative Partido Popular (PP) in 2013, and which has been seen by Spanish daily El Pais, will scrap five articles, effectively bringing to an end the scheme.
According to government figures cited by the paper, of the 15,450 golden visas that have been granted since 2013, only eight were granted for the purchase of public debt, 167 for the buying of shares, 371 for bank deposits, 214 for investment in funds, and 114 for business projects.
A full 95%, or 14,576 of the visas, were granted for the purchase of real estate.
The government, which is a coalition of the Socialist Party (PSOE) and leftist Sumar, has made housing one of its key issues given the rampant price rises in the domestic market.
These high costs are having a detrimental effect on the government’s other measures, such as a rise in the minimum wage, and are particularly affecting young people.
Sanchez is governing in a minority, and relies on the support of smaller parties in Congress to pass legislation.
But this move appears to have widespread support among other parties, and is likely to be approved.
Other European countries had also put similar schemes in place but following the recommendations of the European Commission they have phased them out, El Pais reports.
The text of the amendment also points out that many of the visas were being requested across Europe by Russian millionaires in the wake of the invasion of Ukraine, as well as the fact that the scheme posed serious problems in the fight against money laundering.
