ESTABLISHED in 2013 through an Act of Parliament, the Antigua and Barbuda citizenship by investment (CBI) programme was intended to increase foreign direct investment. It was envisioned as a way to promote development without imposing any new taxes on the country’s 100,000 citizens.

Today, the programme makes up about 10 per cent of the country’s overall budget revenue. Prime Minister Gaston Browne told the Caribbean Investigative Journalism Network (CIJN) this kind of non-tax revenue helped the country “create fiscal space, [to] continue to fund government operations”.

In 2021, that amounted to more than US$45 million.

See Table 1

The Citizenship by Investment Programme (CIP), as it is known in Antigua and Barbuda offers a way for high income individuals to purchase a passport that gives them visa-free access to more than 150 countries. It includes the “crown jewel” of access to the Shengen region of the European Union.

Key for many wealthy clients is the fact that Antigua and Barbuda has no income tax, capital gains tax or inheritance tax on funds earned outside the country.

Another feature is that this second passport can be acquired in as little as three months without ever stepping foot in the country. Unlike rival programmes in the Caribbean, Antigua and Barbuda requires applicants spend at least five days visiting the islands every five years.

There are assorted application fees and a US$7,500 charge for “due diligence” to determine if the applicant has any criminal history or links to terrorism or organised crime.

Essentially, an individual can purchase a passport for as little as US$137,500.

See Table 2

There is a straightforward table of additional charges for spouses and children who would also receive passports. The real estate option costs more but gives prospective buyers an opportunity to sell their properties after a set number of years and earn return on investment. A complete list of options is available online at https://cip.gov.ag/.

Transparency and Accountability

When first presenting a report to Parliament in 2014 on the monies received by citizenship by investment in the National Development Fund (NDF), then Finance Minister Harold Lovell promised, “The money will be used to improve domestic infrastructure, support small businesses, and encourage entrepreneurship – particularly among the youth.”

Examining the budgets and flow of funding, CIJN found ample evidence CBI revenues have become an essential source for day-to-day spending by the Government.

CBI funds are being used to fill critical gaps and shortfalls blamed on the COVID-19 pandemic that resulted in a loss of tourism and declining revenue from taxes.

A “virtual visit” by IMF staff in February 2022 noted how Antigua and Barbuda’s economic fortunes suffered a pandemic-related decline of more than 20 per cent in 2020. That report says Antigua and Barbuda’s economy is now rebounding and could see seven per cent growth in 2022.

By law, CBI funds should be used in “approved projects”. But the same legislation makes it possible for a simple cabinet vote to approve spending on virtually any expense.

Some of that is critical. When the country’s tax revenues couldn’t cover pension payments and government cheques fell two months behind; protests erupted in the capital, St John’s.

The Cabinet responded by dipping into funds from the CBI programme’s National Development Fund to fill the gap. Hundreds of thousands of US dollars were used to prop up the pension plan every month according to records furnished to CIJN through the citizenship investment unit (CIU) reports.