The new index ranks Luxembourg as the world’s best passport for aspiring global citizens.
The small European country ranked first out of 199 in the Nomad Passport Index 2022, published by the tax and immigration advisory service. Nomadic Capitalist.
While many passport rankings focus solely on visa-free travel, this index adds taxation, global perception, dual citizenship, and personal freedoms to its score.
“I don’t think visa waiver is all that matters,” CEO Andrew Henderson said.
According to him, for example, US and Canadian passports are similar in terms of travel. However, “if you are an American, you pay taxes… no matter where you live, and therefore these two passports should not be placed next to each other.”
Here is the index methodology:
In terms of tax policy, 10 points were assigned to places with worldwide taxation (USA) and 50 points to places without taxes (United Arab Emirates). Those who imposed other tax restrictions on passport holders got somewhere in between.
The top 10 is unchanged from last year, Henderson said, and the half-point difference between No. 1 Luxembourg and No. 2 Sweden comes down to “a visa for one additional country.”
Both countries have high taxes, “but if you want to leave, they are relatively flexible,” he said. Both countries are well received around the world and highly valued for personal freedom, Henderson said, noting that Sweden has demonstrated the latter with its hands-off approach to the pandemic.
That full list can be viewed on the Nomad Capitalist website.
Almost 85% of the places in the top 30 of the list are in Europe.
What’s remarkable, Henderson said, is that countries like Malta, Iceland and Slovakia — places “that people don’t often talk about” in terms of passport strength — will hold their own against powers like Italy and Germany. They also score higher than countries such as the UK, Australia and the US.
Australia has been deducted points for restricting its citizens from entering the country during the pandemic, Henderson said.
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Vanuatu dropped from 69th place in 2021 to 85th this year after the Council of the European Union partially suspended its visa waiver agreement with the island nation earlier this month. The decision was prompted by concerns that Vanuatu’s investor citizenship schemes – which allow people to obtain citizenship in exchange for a US$130,000 investment in the islands. – poses a threat to the security of the EU, according to council website.
According to the website, citizenship was granted to people from the Interpol database and the rejection rate was “extremely low”.
It doesn’t necessarily mean that the higher a country’s passport rating, the more suitable it is for those seeking a second or third citizenship there, Henderson said.
People usually create a “passport bag” for one of two reasons: to reduce their taxes or to have a back-up living plan. According to him, Luxembourgish citizenship is unlikely to be suitable for any of these groups.
Singapore, the only non-European country in the top ten, is well received around the world, Anderson said. “Who doesn’t like Singapore?” he said.
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But you can get citizenship in Portugal, the Caribbean or Malta – especially for people from the second group.
The index also shows that some countries’ passports are stronger than people think.
“There are passports that people don’t realize are actually very good,” he said. “Malaysia is barely ahead of the United States, which is very interesting… Everyone I’ve ever met from Central America doesn’t like their passports… [but] Central American passports are actually quite good quality.”