Business Migration for Economic Recovery
6 months ago
There is no doubt that Australia has done well throughout the pandemic, both economically (though significant sectors have not done well) and in terms of health outcomes. Despite this, we face threats to our medium to longer-term prosperity as the government has indicated that our borders may well remain closed for another year or two.
Among the threats are high and increasing national debt, prolonged business interruptions with our major trading partners (many of whom have a much longer path to recovery), supply chain issues and an increasing reduction of available workers and consumers, which includes both student and working holiday visa holders who make a valuable and often overlooked contribution to the national workforce, especially in the hospitality and agricultural sectors.
For some decades now, Australia’s economy has been heavily reliant on migration which typically provides 2 to 3% of national growth. It has also increased the taxpayer base and provided skilled and specialized labor without the associated education costs. Australia will need to maintain the current migration levels longer term to remain competitive and productive and make up for the shortfall caused by skilled workers who may be denied entry for up to four years, depending on their country of origin.
One of the areas of migration that the government is looking to expand to help sustain and grow employment and slow the increase in national debt is with business migration. Business migrant visa holders are now given preferred entry into Australia. The government has increased the planning level for business migrants from 6,862 for 2019-20 to 13,000 for 2020-21, a 97% increase. Additionally, we are noticing much faster processing times over the last six months or indicate the greater priority accorded applications.
The government is eager to reign in the national debt and return to a more balanced budget as soon as possible. There appears to be no appetite to increase taxes to do this, which leaves increasing productivity as the alternative through job creation and an overall increase in working hours and the number of businesses operating. Business migration helps to meet these needs as they are required to make a business investment, own and use a company and employ at least two full-time equivalent, permanent residents or citizens.
From July several changes will come into effect for people wanting to lodge business visa applications. They will be closing the direct entry subclass 132 categories; however the subclass 188 streams will still be available. The government has increased the minimum assets required from $800k to $1.25m and the turnover requirement from $500k to $750k. These are the first increases made in the eight years since this visa category was first introduced and reflect the general increase in assets, especially property, over time.
What makes the program attractive to the government is that successful applicants tend to be highly skilled, experienced, and successful. Therefore, these talents are transferred to Australia even though they are still free to operate their businesses in their home countries. It is hoped that interest in business migration will increase due to the pandemic. Unfortunately, many countries have suffered significant and devastating losses compared to what has happened in Australia, which has an advantage over other comparable countries in processing timeframes investment requirements.
Written by: Blair Commin, Finance Director & Ofﬁce Manager at Parish Patience Immigration Lawyers