Lisbon, Porto and possibly Algarve to lose out in changes to Golden Visa scheme

Lisbon, Porto and Algarve to lose out in changes to Golden Visa scheme

A sting in the tail of changes to Portugal’s extraordinarily successful golden visa regime means the Algarve may too be removed from the equation.

The PS Socialist decision to limit the scope of the programme to “areas of the Interior, Madeira and the Azores” was initially taken to mean that parts of the Algarve would still qualify for golden visa investment.

A real estate source told the Resident last week that the region looked set for a lucrative sales boom (click here).

But on Tuesday in parliament, it appeared that no area of the Algarve, being a “coastal region”, would qualify for Golden Visa via property investment because every municipality is part of what is termed a CIM Litoral (coastal intermunicipal community) – and these too have been taken out of the regime.

Real estate agents and construction bosses have already lamented the changes, saying they threaten the very survival of the programme.

Warnings that the government is ‘killing the golden goose’ have nonetheless fallen on deaf ears.

The government’s reasoning for curtailing golden visas were set out by leader of the Socialist bench Ana Catarina Mendes last month.

She told a press conference in Lisbon that it was time to address the galloping property speculation that golden visas have generated in areas of the capital and Porto, as well as to try and dynamise ‘poorer regions’ where people could do with increased job opportunities.

Mendes said her party hopes the changes “will contribute to greater territorial cohesion”.

The final changes were approved on Tuesday by PS and PSD MPs with votes against by left-wingers Bloco de Esquerda and PAN. Both these smaller parties make no bones about wanting to see an end to the golden visa regime altogether.

Criticism, too, has come from the European parliament.

A special parliamentary committee urged closure of the programme last year, on the basis that it poses a risk to European security and represents an open-door to corruption.

Fervent anti-corruption activist and former Euro MP Ana Gomes described Portugal’s golden visa programme back in the early days as “a race to the bottom”, telling the BBC that European countries were falling over themselves to attract foreign investment without looking closely enough at its origins.

Golden visas are open to entrepreneurs and businesspeople keen to start ventures and create employment but have been overwhelmingly used by foreigners investing in property with the minimum price tag of €500,000.

If all goes according to the government plan, final changes to the regime that has attracted more than €5 billion in foreign investment since its inception in 2012 will be published in State newspaper Diário da República, but only after promulgation by President of the Republic Marcelo Rebelo de Sousa. When the new rules will come into force is still unknown.

By NATASHA DONN
natasha.donn@algarveresident.com