This is a brief summary of the incentives for investment in Panama, which is among the most attractive programs in the world for foreign investors.
Foreign investor protection (Law No. 54)
Issued on July 22, 1998, this law grants foreign investors and their companies within the country the same rights and freedoms enjoyed by Panamanian investors and companies. It has no other limitation than those established in the Political Constitution and the law. This includes references to freedom of trade and industry, import and export. They are also given the right to dispose of their investment earnings and repatriate their interest, profits and dividends.
1. Panama Real Estate Laws
Real estate in Panama boasts exquisite natural settings, including the Caribbean and Pacific coasts, highlands, rainforests, islands, and mountains. Panama properties are affordable and located in popular locations, and there are always great options to choose from. Additionally, investing in property in Panama receives considerable attention from the Panamanian government, resulting in a series of incentive regulations.
1.1 Private property (Article 44)
This section of the Panamanian constitution guarantees the protection of the rights of owners of both Panamanian nationals and foreigners.
1.2 Investment in reforestation (Law No. 24)
This law grants benefits that include a 25-year income tax exemption for investors who acquire properties for reforestation purposes. Issued by the Legislative Assembly on November 23, 1992, the law regulates everything related to reforestation.
Note: Investors interested in this option can enter the country with a specific visa related to reforestation. There are two kinds:
Reforestation Visa: Requires a $100,000 investment in a government certified reforestation project and after a few years, you will be entitled to permanent residency and eventually citizenship.
👉We have agreements with reforestation companies that offer programs for you to INVEST IN REFORESTATION AND OBTAIN PERMANENT PANAMANIAN RESIDENCY WITHOUT LOSING YOURS.
1.3 Islands and Concessions Title Law (Law No. 2) 1.3 Islands and Concessions Title Law (Law No. 2)
1.3 Islands and Concessions Title Law (Law No. 2)
This law gives foreigners the right to buy property on the island, provided it is used for tourism purposes and certain conditions are met. This had never happened before in the history of Panama law. Concessions or leases for state land may also be granted for tourism purposes. Law No. 2 was issued by the National Assembly on January 7, 2006.
1.4 Development of Casco Viejo (Law No. 9)
On August 27, 1997, this decree was issued by which special incentives were established for the reestablishment of the Casco Antiguo of Panama City. For this reason, certain tax reductions and exemptions were created for this purpose. Renovation costs are 100% tax deductible while property sales or rental income is exempt for 10 years. The property itself is subject to 30 years of tax exemption. Please note that the previous laws applied in the Old Town have been modified so that additional areas are added for their protection. This includes part of the neighborhood of Santa Ana, Salsipuedes and part of Terraplén.
Incentives for investment in Panama in other businesses.
Panama uses the US dollar as its currency, therefore there are no exchange controls to limit the amount of currency that can be traded.
2. Incentives for investment in other businesses in Panama
Panama uses the US dollar, therefore there are no exchange controls to limit the amount of currency that can be traded.
2.1 Colon Free Zone (Law No. 18)
Located at the Atlantic entrance of the Panama Canal, the Colon Free Zone is a free port that is home to more than 2,500 companies, employs more than 28,000 people, and ships more than $16 billion a year. Companies operating within this zone are both foreign and domestic, most of which enjoy tax exemption, on the condition that they meet a certain set of requirements. These include employing at least 5 local Panamanian workers, maintaining certain reporting criteria, and exporting a minimum of 60% of their merchandise.
2.2 Special, Comprehensive and Simplified Free Trade Zone Regime (Law No. 32)
This law authorizes the establishment of duty-free zones in any part of Panama, as long as they do not interfere with the local ecosystem. To date, there are 14 registered free zones and nine of them are already in operation. Read more about Law No. 32
2.3 Panama Pacific (Law No. 41)
This law establishes a special regime for the establishment and operation of a Panama-Pacific Special Economic Area and an autonomous government entity called the Panama-Pacific Special Economic Area Agency. Formerly Howard Air Force Base, this duty-free zone attracts certain categories of businesses. To name a few: corporate headquarters, call center, film industry, distribution and logistics centers, technology manufacturing, and naval and aviation goods and services. The area also features a one-stop shop that houses 12 government agencies under one roof to make it easy to do business, obtain permits, and more.
2.4 Manufacturing and processing industry (Law No. 3)
Manufacturing and processing companies that export all of their products are exempt from most direct taxes and import duties on equipment and machinery. The eligibility of companies for these incentives under Law No. 3, it is necessary to register in the Official Registry of National Industry, a department of the Ministry of Commerce and Industry.
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