New Immigration Law may exclude investors who brought the biggest fiscal benefit
On August 20 the Saeima votes for a second time on the Immigration Law returned by the President for reconsideration. A lawyer warns the law removes residence permits tied to real estate or business investment, even though this small group has contributed millions to the budget.
On Thursday, August 20, the Saeima holds an extraordinary sitting to vote for a second time on the new Immigration Law. The version passed in June was not promulgated by the President, who sent it back for reconsideration, asking lawmakers to keep a regulated option for citizens of NATO, OECD and European Economic Area states to obtain temporary residence permits based on real estate purchases or other investments. The responsible committee rejected this proposal on August 12, and the law is expected to pass unchanged on August 20 — after which the President will no longer be able to return it again.
A lawyer specializing in immigration law argues in a published opinion piece that none of the debates addressed which groups of immigrants actually benefit the state financially and which create costs, since Latvia, unlike Denmark or the Netherlands, does not calculate such balances. Still, data from the Office of Citizenship and Migration Affairs show that as of July 1 this year, Latvia had 81,490 valid temporary residence permits, of which 2,136 were issued based on real estate purchases and 376 based on business investment. Including family members, investors made up about three percent of all permit holders; excluding family members, under one and a half percent. The remaining 97 percent of applications came from students, labor migrants and their families, a group for which no fiscal impact calculation exists.
New conditions
The new law eliminates residence permits based on real estate investment or bank subordinated capital contributions, while shortening the permit term for business investment from five to two years and adding a requirement to pay a set amount in taxes annually. The only remaining investment route will be a 150,000-euro investment held for at least five years in a state-created alternative investment fund, plus a 10,000-euro payment to the state budget. The author notes this threshold is lower than the previous real estate investment requirement, and that during the committee hearing it emerged the fund has not yet been established, so it is unclear when this option will actually become available.
The opinion piece also highlights the haste behind the law's passage — three weeks before the end of this Saeima's term and seven weeks before elections — along with technical flaws in the text, including a reference to a subparagraph that does not exist. The author suggests leaving the final decision to the next Saeima so migration policy can be based on data rather than pre-election urgency.
