Closure of golden visa scheme 'enormously damaging' to UK economy

A City law firm has said the government’s decision to scrap the so-called ‘golden visa’ scheme will unfairly punish international investors for Russian geopolitical tensions.

The government announced yesterday (17 February) it had shut the Tier 1 Investor visa route to all new applicants from all nationalities with immediate effect.

The route, launched in 2008, had allowed entry and stay in the UK if an applicant invested funds in share capital or loan capital in active and trading UK registered companies. The applicant was required to have at least £2m in investment funds and a UK bank account.

The government said the scheme had been under “constant review” and some cases had caused security concerns – people acquiring their wealth illegitimately and being associated with wider corruption.

Home Secretary, Priti Patel, said:'¯“I have zero tolerance for abuse of our immigration system. Under my New Plan for Immigration, I want to ensure the British people have confidence in the system, including stopping corrupt elites who threaten our national security and push dirty money around our cities.

“Closing this route is just the start of our renewed crackdown on fraud and illicit finance. We will be publishing a fraud action plan, while the forthcoming Economic Crime Bill will crackdown on people abusing our financial institutions and better protect the taxpayer”.

However, City law firm Bates Wells said the loss of the scheme will unfairly impact high-net-worth individuals and overseas investors from many different countries, who will be limited in their options should they wish to come to the UK. New programmes, set to be introduced in spring, will be aimed at entrepreneurs and will not provide routes for investors.

Bates Wells immigration partner, Chetal Patel, said ending golden visas would impact all nationalities. “It seems unfair that overseas nationals from all countries will be denied this route because of what is happening in Russia”.

Patel added: “Since the introduction of Golden Visas in 2008, the UK has benefitted from billions of pounds of investment”. She said the closure of the scheme will be “enormously damaging” to the UK economy.