{"id":696343,"date":"2023-06-18T13:00:00","date_gmt":"2023-06-18T11:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=696343"},"modified":"2023-06-15T16:41:42","modified_gmt":"2023-06-15T14:41:42","slug":"why-south-africans-are-getting-a-second-passport","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business-opinion\/696343\/why-south-africans-are-getting-a-second-passport\/","title":{"rendered":"Why South Africans are getting a second passport"},"content":{"rendered":"\n

There are numerous benefits of having a second passport on top of the standard South African green book, including increased visa-free access to certain countries and enhanced options for personal and financial security.<\/p>\n\n\n\n

With highly skilled people leaving to suspected greener pastures, more people are turning to ditching their South African passport or, in many cases keeping it as a backup.<\/p>\n\n\n\n

Tax Consulting SA said that there is, however, a difference between a second passport and getting a right to permanent residency.<\/p>\n\n\n\n

“When you get a passport, you become a citizen of another country and with this comes all the rights and privileges of your adopted country of citizenship. Permanent residency allows you to permanently reside in a country, such as the United States Green Card or Mauritius Permanent Residency, as two well-known examples,” said the tax firm.<\/p>\n\n\n\n

According to Tax Consulting SA, a person can acquire a second passport through investment in Europe and various Caribbean islands. Acquiring a second passport through these methods are some of the most accessible options.<\/p>\n\n\n\n

Recent data from the Africa Wealth Report 2023 assessed the African passport’s power<\/a> and ability to encourage economic mobility.<\/p>\n\n\n\n

The report found that although it is the third strongest passport on the continent, the South African travel document offers poor economic mobility, offering only 15% access to the global GDP visa-free.<\/p>\n\n\n\n

Places such as the Seychelles and Mauritius rank above South Africa, with the island states in first and second, respectively.<\/p>\n\n\n\n

Citizenship by investment programs offers mobility, risk mitigation, and wealth diversification. A second passport also allows travel, residency abroad, and investment opportunities. Tax Consulting SA noted however that financial emigration often precedes obtaining a second passport.<\/p>\n\n\n\n

The tax consulting firm provided the five following reasons as to why many South Africans are looking to get their hands on a second passport:<\/p>\n\n\n\n

Family security<\/strong><\/p>\n\n\n\n

Overall safety, the possibility of building better generational wealth and opportunities for international education are some of the driving factors behind people considering a second passport.<\/p>\n\n\n\n

On top of this, certain state benefits, including healthcare, are attractive to those with families.<\/p>\n\n\n\n

Seeking economic stability<\/strong><\/p>\n\n\n\n

“A strong driving factor for wealth migration is rooted in future-proofing oneself against currency and economic and political uncertainty. South Africa\u2019s recent greylisting and fluctuating currency, along with its poor service delivery and the energy crisis adds to these uncertainties,” said Tax Consulting SA.<\/p>\n\n\n\n

Wealth protection<\/strong><\/p>\n\n\n\n

Well-off South Africans have intensified the need to diversify and secure their financial position through investment in a hard currency.<\/p>\n\n\n\n

There is an underlying nervousness about financial stability, and the reasons for this are well known, said Tax Consulting SA.<\/p>\n\n\n\n

Wealth tax<\/strong><\/p>\n\n\n\n

Having a second passport allows one to move to a more tax-friendly environment where there are fewer tax burdens, including no capital gains taxes, donation taxes and estate duties.<\/p>\n\n\n\n

“This means there is considerably better wealth preservation and transfer of hard-worked monies to future generations,” said the tax firm.<\/p>\n\n\n\n

The South African system has high taxes, with a top marginal tax rate of 45%, effective capital gains taxes at 18%, estate duty at 25% and retirement tax, which is capped at 36%, said Tax Consulting SA.<\/p>\n\n\n\n

Ease of international travel<\/strong><\/p>\n\n\n\n

A holder of a second passport may have the ability to travel to several countries without a visa.<\/p>\n\n\n\n

“For example, obtaining a European passport could allow you to travel to over 160 countries, or if you opt for a Guernsey passport, you can travel to 89 countries without a visa. In some instances, you will receive a visa on arrival, eliminating traditional visa application routes.”<\/p>\n\n\n\n

This makes travelling for business, pleasure, and education much easier and hassle-free, Tax Consulting SA said.<\/p>\n\n\n\n

\n\n\n\n

Read:<\/strong> South Africa is playing with fire<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Tax Consulting SA highlights the push toward more financial diversification and opportunities offered up by alternative passports.<\/p>\n","protected":false},"author":10,"featured_media":675925,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[26,12796],"class_list":["post-696343","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-opinion","tag-headline","tag-tax-consulting-sa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/696343","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=696343"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/696343\/revisions"}],"predecessor-version":[{"id":696357,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/696343\/revisions\/696357"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/675925"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=696343"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=696343"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=696343"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}