Vanuatu: Zero Tax, and a Passport That No Longer Opens Europe

Vanuatu ranks 11th out of 217 in our world ranking, with a FiScore of 9 out of 10. Eighty-three islands in the South Pacific, and a tax system that takes essentially nothing.

It is also the jurisdiction most aggressively marketed to people who do not understand what a passport does. So let us do both halves honestly.

The taxes that do not exist

• No personal income tax.
• No corporate income tax.
• No capital gains tax.
• No inheritance or gift tax.
• No wealth tax.

There is no withholding tax on dividends, interest or royalties either. The state funds itself through VAT at 15%, import duties and licence fees.

This is not a carve-out or a special regime. Vanuatu simply does not levy income tax on anyone.

The passport, and what the sellers leave out

Vanuatu runs the fastest and cheapest citizenship-by-investment programme in the world. Roughly 130,000 US dollars for a single applicant, processed in one to two months, with no residence requirement before or after, no language test and no interview.

Every promotional page you will read lists visa-free access to the Schengen Area among the benefits.

That is no longer true.

The reasons the Council gave are worth reading, because they explain why this is unlikely to be reversed: citizenship granted to applicants appearing in Interpol databases, processing times too short for meaningful screening, and a single recorded refusal before 2020.

A Vanuatu passport holder now applies for a Schengen visa like anyone else. If a brochure tells you otherwise, it is out of date or it is selling you something.

The thing a passport does not do

This matters more than the visa question, and it applies to every citizenship-by-investment programme.

Buying a passport does not change your tax residence.

Tax residence is decided by where you actually live, where your home and family are, and by the rules of the country you are leaving. Nothing in a Vanuatu naturalisation certificate severs that.

If you are French, article 4 B keeps you resident while your household or your economic centre stays in France. If you are American, citizenship-based taxation follows you regardless, and a second passport changes nothing until you renounce the first.

The programme sells a travel document. Some buyers hear a tax plan. Those are not the same product.

Actually living there

If you do move, the zero applies to you in full and the setting is remarkable: reef, volcanoes, and a cost of living far below the Caribbean equivalents.

The trade-offs are equally real. Vanuatu sits in a cyclone belt and on the Pacific Ring of Fire, with regular seismic activity. Medical facilities are limited and serious cases are evacuated to Australia or New Zealand. Connectivity has improved but remains modest. Imported goods carry heavy duty.

It is a genuine place to live for someone who wants that life, and an implausible one for someone who wants Europe with a Pacific passport.

So, who is Vanuatu for?

• Someone actually relocating to the Pacific: zero on everything, and a setting few places match.
• Someone buying mobility: the EU door closed in December 2024. Price the passport on what it opens today, not on a brochure.
• Someone hoping to change tax residence by buying a passport: it does not work that way, anywhere.
• A business owner: no corporate tax at all, but check how your customers' countries treat a Vanuatu entity before you build on it.

The full table is on our Vanuatu page.

Sources

Figures and dates verified in August 2026 against the Council of the European Union press release of 12 December 2024, Regulation (EU) 2018/1806 and its suspension decisions, and Vanuatu government publications on VAT and the citizenship programme. An error reported to us gets fixed.

This page informs, it does not advise. Citizenship programmes are sold by people paid on commission: take independent advice before paying anything, as our terms of use set out.