With an increasing number of people holding dual citizenship around the world, one may question the benefits they bring to the countries involved. A dual citizenship implies the possession of more than one citizenship simultaneously, wherein each citizenship ties the holder to a set of rights and duties applicable to nationals of each country, regardless of the duration the person has spent in that country or the extent of his/her social, personal, economic, political, or cultural ties with the country.
Countries have often questioned whether dual citizenship should be allowed, as they are concerned over the financial burdens these may create. However, supporters of dual citizenship believe that by allowing dual citizenship, a country can actually move a part of their population from being a financial burden to becoming an asset for the economy.
Citizenship is a political construct that draws its value from the political, economic, and social responsibilities and rights attached to it. Loyalty and allegiance to a country are therefore intrinsic to one’s citizenship. Considering this, it would be natural for a country to never allow a citizen to pledge allegiance to another country as it would seemingly call into question his/her loyalty to them.
However statistics show that there are increasing number of dual-citizenship holders around the world, with more and more countries becoming tolerant of the trend, with some even encouraging it. Dual citizenship is being increasingly encouraged in order to capitalize on the financial resources and contributions of a country’s diaspora.
The pool of immigrants worldwide actually have a great effect on cross-national relations between their home countries and the nations they emigrate to. They can serve as vital economic and political resource in the host country, while also representing their countries of origin. Directly or indirectly they serve as agents of change, through lobbying and negotiating with governments on policies which promote their homeland’s interests.
The economic benefits received by the homelands of immigrants are also substantial. According to a 2013 World Bank report, immigrants sent about $414 billion back to their home countries in that year, with India alone receiving $71 billion from foreign remittances.
Obtaining dual citizenship can offer a range of benefits to the individuals too. It can enhance your travel experience by giving more freedom to go around without restrictions and can also offer you a choice in life on where you would like to settle eventually or retire. Moreover for wealthy investors looking for alternative destinations for settling down, there are a variety of investment options to choose from that can be profitable financially, and can be especially useful in efficient tax-saving. In addition, the investors can get ease of travel, privacy and security in the place of their choice.
However the decision to move abroad can either be extremely rewarding or disastrous depending on how it is planned. Migrating abroad can have several financial implications and it is extremely important to be aware of all related laws in your homeland before taking the decision to move. Several tax considerations need to be evaluated as well – like double tax treaties, remittances, overseas tests, exemptions, residency and domicile considerations, sufficient ties tests and split year treatment. A lot of other taxes like capital gains tax, gift tax, inheritance tax, estate tax, and income tax are directly affected by the said tax considerations.
In addition it is important to carefully choose the country you want to move to, taking into account various factors like your intended economic activity there, in addition to other things like climate, language, and perhaps employment or education options for your family members. Whether you need to focus on your business in your home-land or in your host country is an important decision to take and one that can have long-term implications.
Dual citizenships, beneficial as they, need to be carefully planned and there is no one-rule-fits-all policy. Every individual is affected differently based on personal factors and if a person considering such a move does not have the time to do thorough research, then a professional adviser must be consulted to assist in making the right choices.
Source: gulfbusiness.comGeneral Information: Contact us to receive more information about this article.
Interested Investors: Kindly complete the following form and we will contact you to discuss your global residency and citizenship investment options.