Panama continues to offer lucrative tax breaks
Panama has in recent times come under the magnifying glass, as many large organisations and individuals look for a means to avoiding sizeable tax bills. This shouldn’t however put you off the idea of setting up in one of the most stable markets in South America. Annual inflation has averaged 1.4% for the past 30 years, and with strong revenue coming from the Panama Canal ($712.4 million in total revenues per annum) the country continues to be a strong investment contender.
There are some strong incentives to investing; if you look to invest just £45,000 anywhere in Panama’s markets you are entitled to:
A 20-year exemption on property taxes
A 20-year exemption of any import taxes due on materials, furniture, equipment, and vehicles
An exemption from any tax normally applied to import/export from either airports or piers
If you setup a business in one of the specially designated tourist zones, you receive a 15-year break on income taxes.
These lucrative breaks have managed to attract a whole host of large international business, many of whom see Panama as the hub of activity for all business conducted in South America. It almost impossible to walk through capital without seeing construction cranes as far as the eye can see. With the government offering residents the ability to deduct 100% of the costs of the renovation from personal income tax, many are taking advantage. It will be interesting to see how long this internal investment can continue.