The Government has announced today its "Industry Innovation
and Competitiveness Agenda" that is designed to drive growth
and jobs in key industries. A key part of the agenda is changes to
the Significant Investor Visa programme (SIV).
The purpose of the SIV reforms is to encourage high net worth
individuals to make Australia home and better direct additional
foreign investment into Australia.
The proposed changes include:
Streamlining and speeding up the processing of SIV
Aligning the criteria for eligible investments with the
Government's national investment priorities and will be
determined by Austrade in consultation with key economic and
The introduction of a Premium Investor Visa (PIV) that will
provide a twelve month pathway to permanent residency for those
meeting a $15 million threshold; and
Austrade will become a nominating entity for SIV's
(complementing State and Territory Governments).
The proposed changes will take effect in the current fiscal year
and the PIV will be introduced from 1 July 2015.
The streamlining changes are welcomed and should improve the
attractiveness of Australia for foreign investment.
The introduction of the PIV should also encourage foreign
investment into Australia by offering a unique pathway to
Australian residency. The additional foreign investment into
strategic areas should ultimately assist with economic growth.
However, the benefits from a taxation perspective of SIV's
should be compared to PIV's. Depending on the goals of the
foreign investor, the SIV could still be more attractive than a
PIV. The SIV requires a lower investment amount and the person is
treated as a "temporary resident of
The advantage of being a "temporary resident of
Australia" is that the person is only subject to tax on
income earned from capital amounts invested in Australia and profit
made from the sale of any Australian investments as compared to
residents of Australia who are subject to tax on their worldwide
income and capital gains.
The Treasurer will consult with industry to ensure that the
draft legislation will deliver the intended outcome.
Because of the high costs, royal commissions should only be convened to address issues of substantial public importance.
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