Economy Guide in Marshall Islands

Exact Cost of Living Index is unavailable. However, the Rent Index (19.6) and Restaurant Price Index (42.7) indicate generally affordable costs compared to NYC. Recent minimum wage increases aim to address local cost of living challenges.

The Property Price to Income Ratio is unavailable. The Rent Index (19.6) suggests affordable rental costs. Foreigners cannot own land but can lease it for up to 55 years, which impacts the property market for expats.

The Purchasing Power Index is unavailable. With a GDP per capita (PPP) of $8,195 in 2024 and a medium Human Development Index (0.639), average income and purchasing power are considered low. The minimum wage is set to increase to $4.00/hour in October 2024, rising to $5.25/hour by October 2027.

The personal income tax is progressive, with rates of 8% on wages up to $10,400 and 12% on income above $10,400, with an exemption for lower incomes. There is no national VAT, but local sales taxes apply in some municipalities. A national VAT is planned for October 2026. There are no capital gains, wealth, or inheritance taxes.

The Marshall Islands ranked 153rd in Ease of Doing Business in 2019. Foreign investors require a Foreign Investment Business License and cannot own land, only lease it. There are restrictions in certain small-scale businesses. However, the government encourages foreign investment in key sectors like fisheries and tourism, offering incentives.

The Marshall Islands Social Security Administration (MISSA) provides old-age pensions, disability, and survivor benefits for gainfully employed and self-employed persons. A social insurance system for medical benefits is in place, though healthcare access can be challenging due to the dispersed population. Non-citizens are eligible for limited benefits.

Deposits at branches of U.S.-chartered banks in the Marshall Islands are insured by the Federal Deposit Insurance Corporation (FDIC) up to USD 250,000 per depositor. The local financial sector is underdeveloped, with efforts underway to establish a Monetary Authority to enhance stability and supervision. The Marshall Islands is a fully dollarized economy.