Luxembourg has announced plans to phase out its Golden Visa Program, a scheme that has drawn growing interest in recent years but remains underutilized.
According to Luxembourg Times, a spokesperson from the Home Affairs Ministry confirmed that the government is currently assessing the relevance of the investor residency program, as reported.
What the Program Offers
Luxembourg’s Golden Visa scheme allows non-EU nationals to secure residency in the country, along with visa-free travel across the EU. Applicants have two main pathways:
- Investment Option: Invest €500,000 into the Luxembourg economy.
- Private Residency Option: Demonstrate an annual income of at least €27,000.
Despite its perks, the program has seen limited uptake. Between 2023 and 2024, only six applications were submitted, four of which were rejected. Applicants reportedly hailed from countries like Russia, Israel, India, and China, though authorities have not disclosed details about the rejected cases or the reasons behind the refusals.
Temporary Residency, Limited Timeframe
Successful applicants to Luxembourg’s Golden Visa Program are granted a temporary permit valid for five years. This document transitions into a formal residence permit once the holder arrives in Luxembourg.
Investment-based permits initially provide residency for three years, while those granted for private reasons offer just one year, both with the possibility of renewal. Processing these applications typically takes around six months.
Declining Participation
The program has historically struggled to gain traction. A European Commission report from 2018 noted that, during its first year, only one Australian citizen and five Chinese nationals obtained residency through the scheme. By 2023, only three additional applications had been approved, underscoring the program’s minimal popularity.
Interestingly, despite the low demand, Luxembourg’s government had previously dismissed the idea of scrapping the program, citing it as a low-priority issue. However, that stance appears to have shifted, likely influenced by broader EU attitudes toward such initiatives.
EU Pushback on Golden Visas
Across Europe, Golden Visa programs have faced mounting criticism. While they bring substantial financial benefits to host countries, these schemes have come under fire for allegedly enabling corruption, tax evasion, and housing market distortions.
Spain, for instance, recently announced plans to abolish its Golden Visa program by April 2025, citing concerns over its impact on housing affordability. Similarly, Portugal has already eliminated its real estate investment route, which had allowed residency in exchange for purchasing property worth €500,000 or more.
As scrutiny around investor residency programs intensifies, Luxembourg’s decision to reconsider its own Golden Visa reflects a broader European trend of moving away from such initiatives.