Citizenship Sales Outstrip VAT to Become Vanuatu Govt’s Biggest Revenue SourceAugust 24, 2019
In 2018, reports Vanuatu’s Ministry of Finance and Treasury, CBI-related revenue reached such unprecedented levels that, for the first time in the country’s history, it displaced VAT-receipts as the government’s single biggest source of funds.
“In 2018, revenue from the honorary citizenship programs overtook that of VAT for the first time. The Government remains careful not to rely on the income stream from the honorary citizenship programs and is working on implementing the Tax Administration Act to make the collection of tax revenue more efficient.,” said the ministry’s half-year report.
While CBI-income broke all previous records last year, revenue in 2019 is poised to match, if not exceed, that seen in 2018. Out of the government’s total revenue of 15.6 billion vatu in the first half of 2019, fully one-third arose from the country’s two citizenship by investment programs – the Vanuatu Development Support Program and the Vanuatu Contribution Program.
“Together, VCP and VDSP collected VT 5,364.6 million by the end of June 2019. This is 82.5% of the revised budget target of VT 6,504.6 million and is 16.4 per cent more than the VT 4,610.6 million revenue from VDSP and
VCP during the same period last year,” read the report.
The IMF, who last year forecast that Vanuatu’s CBI revenue would fall by 72% this year, has cautioned the country’s government not to grow accustomed to the revenue source, which they consider a windfall rather than a “new normal”. The half-year report will test the credibility of the organization’s forecasting capabilities.
Want to know more about Vanuatu Citizenship by Investment? Browse hundreds of firms who can assist with an application, or visit the Vanuatu program page to see recent articles, statistics, official links, and more.
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Image courtesy of: Phillip Capper from Wellington, New Zealand [CC BY 2.0 (https://creativecommons.org/licenses/by/2.0)]
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