Newsletter and Life Update - June 26
A monthly portfolio and life update on tax, copper, Paraguay, and building a real sovereign exit as an Australian in South America.
I keep finding new reasons to confirm my already obvious bias toward Paraguay and the opportunity it presents.
Especially after running the numbers on the latest Australian federal budget, and what it does to anyone who still tries to build wealth by taking risk.
From 1 July 2027, the 50% capital gains discount is set to be replaced by inflation indexation, alongside a new 30% minimum tax rate on capital gains.
Most of it is still announced rather than law, but the direction is not subtle.
Australia is making it harder to justify taking risk with capital.
Run the maths and it gets close to absurd.
Australia is about to have the highest top capital gains tax rate in the developed world, above Denmark.
Scrapping the discount roughly doubles the effective rate. At up to 47%, it beats Denmark’s 42%, currently the OECD’s highest.
For a lot of people, the incentive is now obvious. It is genuinely better to pay down the mortgage and pocket a guaranteed, tax-free return than to risk capital in a business or the share market and hand back a third or more of any gain.
So let us see if people actually take action and go where they are treated better, and where the opportunity to make money actually is.
Which brings me back to Paraguay.
Below, I comment on the current portfolio setup, Andina Copper, with nothing that has not already been disclosed publicly. I am heading back to Colombia this week, and very much looking forward to being around the Cobrasco project and getting a read on the vibe on the ground now that a pro-business president has been elected.
There are also some personal updates, and a few tips for optimising life in Paraguay. I recently bought a car and renewed the lease on my apartment.
Send me a message if you want information on how to get started with an exit plan, or if you want more detail on Paraguay specifically.
The pressure is already starting to mount. Requirements are getting tighter, the process is becoming more demanding, and the price has almost doubled in two years.
The quicker you get permanent residency sorted, the better.
In terms of overall value, I do not think anything else compares to Paraguay.
Low cost of entry, territorial tax, simple residency, cheap living, good lifestyle, USD banking options, and a real base outside the Western tax machine.