Contrary to a vast majority of Latin America countries Panama benefits from simple and business favorable tax system, stability and steady GDP growth. Basically Panama enforces 25% income tax and 10% withholding tax on dividends. But the income originating outside of Panama is not a subject to income tax. It is so-called territorial tax system. The property taxes were significantly reduced recently, although investing into your primary house in Panama will guarantee you a 15-year property tax exemption. Stability Law provides 10-year stability as of the registration of the investment that all legal, tax, customs, municipal and labor rules will remain identical to those in force at the time of registration. This is an important guarantee to secure no-changes will affect the amortization of investments. To sum it up, Panama is an open, trade friendly, USD based economy that enjoys a sustainable bureaucracy burden.
