A version of this article appeared for the first time in Inside Wealth Newsletter of CNBC with Robert Frank, a weekly guide to the investor and the consumer of net value. Register To receive future editions, directly in your reception box.
According to experts, President Donald Trump Donald Trump offered $ 5 million for residence in the United States.
However, it also includes a tax escape which would offer holders of the new card a lucrative advantage not accessible to American citizens, according to experts.
Trump announced this week the creation of a new investment visa which gives the rich permanent residence abroad and a path to citizenship in exchange for $ 5 million. Lawyers who advise the rich on migration and investment visas say that demand is already strong.
“The introduction of the Visa Gold Card program represents a unique opportunity for people with high knotters who seek to secure the American residence with a path to citizenship,” said Dominic Stef, head of private customers in Henley & Partners. “The United States remains the undisputed leader in private creation and accumulation.”
Stef and other people who are addressed to the rich worlds have said that they have already used customer calls wishing to buy a Trump Gold card. According to Henley, around 135,000 millionaires from the world are expected to migrate to a new country in 2025. The United Arab Emirates and the United States are generally at the top of the list of destinations.
“I think it’s going to sell like crazy,” Trump said at his first cabinet press conference on Wednesday. “It’s a good deal.”
Although the details remain vague, the proposal would radically change the American residence path for the rich worlds, which must currently navigate a patchwork of programs with close restrictions to stay in the country. It would also mark a major potential tax change for the rich worldwide in the United States, with a new gap for holders of gold card.
Currently, American citizens, permanent residents and holders of green cards must pay the income tax on their American income as well as all the income they earn abroad, including in their country of origin. The US tax on world income has traditionally rendered American residence or citizenship much less attractive for the rich worldwide, which have companies distributed around the world and often sheltered in tax havens.
Trump said gold card holders would not be subject to taxes abroad. The arrangement means that residents of the gold card will be able to buy a tax advantage not available for American citizens. Advisers say they expect clearer directives, as the program could create two taxpayer classes among the rich Americans.
However, international income sculpture makes it much more attractive for the ultra-rich worlds.
“It would be a big departure” in tax treatment, said Laura Fote Reiff, lawyer for Greenberg Traurig, specializing in corporate immigration. “There are many rich people who are invested in American companies or who have families here who do not become permanent residents because they do not want the tax consequences.”
The tax escape is one of the reasons why the government can charge a bonus for the gold card. At $ 5 million, the program would be among the most expensive in the world. Step said that the global Singapore investor program requires an investment of $ 10 million in Singapore, or about $ 7.5 million. New Zealand’s most expensive program requires an investment of up to $ 10 million in New Zealand, or around $ 5.7 million.
Most of the world’s investment visa programs cost less than a million dollars, lawyers.
According to Henley, around 100 countries offer a certain type of investment visa program, with around 60 jurisdictions actively promoting their programs, according to Henley. About 30 programs dominate the investment migration activities of $ 20 billion a year, Malta, the United Arab Emirates, Portugal, Italy and several jurisdictions in the Caribbean being the most popular.
At the press conference on Wednesday, Trump and trade secretary, Howard Lunick, said that the American gold card would replace the current investment visa program, called EB-5, which offers green cards to those who invest at least $ 900,000 or $ 1.8 million, depending on the area and the project. The EB-5 program was prey to delays and history of fraud and abuse. The program was renewed by the Congress in 2022 with major changes that required investments to be channeled towards more rural and poor areas and for infrastructure projects.
Regarding candidates, China was by far the greatest source of those looking for EB-5 visas, Taiwan, Vietnam and India also ranking. The United States delivered just over 12,000 EB-5 visas last year, two thirds going to Chinese nationals, according to the State Department.
The wealthy Chinese are also dominant users of investment visa programs in the world, including in Europe, Australia and New Zealand.
While Trump said the United States could sell a million gold cards, lawyers claim that probable demand is a fraction of this total-perhaps thousands but not hundreds of thousands. There are around 424,000 people worldwide worth $ 30 million or more, including 148,000 in the United States, leaving around 277,000 ultra-rich abroad which could reasonably afford the program.
However, only a small fraction of them would probably apply to living in the United States, according to immigration lawyers. Last year, the United States had a net influx of around 3,800 million millionaires according to Henley.
“Hundreds of thousands seem high,” said Fote Reiff. “There may be companies that would pay to bring talents, such as researchers they want to bring here and not be subject to quotas.”
A large print of the new program is the tax advantages. Historically, permanent residents in the United States must pay income tax on its American income as well as all the income they earn abroad, including in their country of origin. The US tax on world income makes it much less attractive for the rich worldwides that have companies around the world and often sheltered in tax havens.
Trump said he expects the largest demand to be companies (especially in technology, such as Apple) seeking to hire the best colleges graduates in the United States who come from India, China or other countries, but cannot obtain appropriate visas.