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Increasing number of millionaires moving to Australia

Recent released figures from the Department of Home Affairs show that the number of millionaires migrating to Australia jumped to 7260 in the 2016-17 year. This is despite concerns raised from the Business Council of Australia over Australia’s high income tax rate dampening the migration of millionaires from Asian countries such as China, Malaysia and Vietnam. This influx of the high net work individuals is providing a multi-million dollar investment surge into major Australian cities such as Sydney and Melbourne.

Visa applications have increased by 74% in 2016-2017 for individuals with more than $2.25 million in business and personal assets. During 2016-17 9051 Visa applications were submitted, which is up from 5781 in 2014-15. Of these applications, 7260 were approved.

A fast track Visa can be obtained in as little as 40 days and does not require the migrant to pass tests related to English skills, employment qualifications or education. The “significant investor 188” Visa stream asks foreigners to invest $5 million of their funds into Australian shares, bonds, manages funds, and commercial real estate. 2000 of these Visas have been approved so far, resulting in a $10 billion cash injection into the Australian economy.

In 2017 Australia had a net migration of 10, 000 millionaires, which is the highest net migration of millionaires to any country in the last year, according to John Daley of the Grattan Institute.

Although Australia has a comparably high top marginal tax rate of 45%, which begins at an income of $180 001, it has not deterred many foreigners from wishing to move here. Singapore with its low income tax rate of 15% attracted only 1000 millionaires to its shores.

There are many other reasons why foreigners are seeking to move to Australia. For example Australia has an agreeable climate, is politically stable, with low crime rates and good educational opportunities. Australia’s proximity to the Asian continent, similar time zones and lack of inheritance taxes were also reasons given by many wealthy Asian foreigners in their decision to move here, rather than the UK or USA.

The increasing political strain between China and Australia has not slowed down the private Chinese migration in 2016-17 with mainland China providing 90% of the millionaires migrating to Australia, followed by Hong Kong.

China has become a powerhouse for creating newly minted millionaires in the last 10 years, as a result of its unimpeded growth in the technology, constructions and manufacturing sectors.

One Chinese investor observed he made the decision to transfer his wealth to Australia to become eligible for a Visa once his children started studying in Australia.

It’s an advantageous Visa program for many. Migrants do not have to come to Australia and work, it provides the flexibility to invest $5 million in local shares and projects and their children will be able to attend Australian schools and universities.

AfrAsia Bank which polls its wealthiest clients, advises that Australians can expect to see an increase in the lifestyle and hobbies of the rich such as watch collecting, fly-fishing and New York style “hotel residences”.