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URUGUAY AND PARAGUAY : TWO SAFE HAVENS FOR WARY INVESTORS WHO NEED A PLAN B
BY PHILIPPE MAY
Step-by-step guide to apply for residency in the South American nations .
Uruguay and Paraguay are two countries in South America which are often overlooked . Yet they offer a great option for wealthy migrants who look for a permanent residence that can be converted to citizenship after some time . While most of Latin America offers some sort of RCBI programs these two MERCOSUR member countries have special features that are unmatched by others .
SAFETY AND TAX-FRIENDLY CLIMATE IN URUGUAY AND PARAGUAY
Both Uruguay and Paraguay are relatively small countries , at least by regional standards ( Paraguay is bigger than Germany and Japan , Uruguay is bigger than Switzerland and the Benelux countries combined ). They have enjoyed political stability for decades and have not suffered from economic chaos , hyperinflation , left-wing populism and rampant crime like their neighbors . The fiscal environment is pleasant as well : traditionally business-friendly Paraguay has a strictly territorial tax system which only taxes local income and even this at a standard rate of only 10 %. In Uruguay , income tax rates are higher , but new tax residents can enjoy a temporary income tax exemption of 10 years ( tax holiday ) on foreign income . Alternatively , they can opt for a reduced 7 % rate that will apply permanently on such foreign sourced income .
Both countries have attracted a significant number high networth individuals who relocated from the larger neighboring countries as well as from further afield , especially USA and