Panama Tax Reform expected for Year-End

According to Economy Minister Alberto Vallarino, the tax reform project will be ready between November and December.

Tuesday, July 28, 2009

The current administration is studying the removal of some levies and the new income tax rate.

"Some activities, like ports and casinos, will be charged more if the project is approved", reported newspaper La Prensa.

"Nowadays ports are paying only $20 million to the state, less than the $22 million that just one of them, Panama Ports, was expected to pay under their original contract".

More on this topic

Panama to Approve Tax Reform in 2009

May 2009

Among the main reforms that the tax system is looking to simplify is the elimination of alternative income tax calculation.

The new income tax rate that will be applied has yet to be defined.

Prensa.com reflected the statements of the new Economy and Finance Minister, Alberto Vallarino: "I am a believer in low taxes because they help in collection, especially in countries where we do not have a culture of paying taxes, which is a reality not only in Panama, but in every Latin American country."

ZLC Users Oppose Fiscal Reform

July 2009

Users of the Colón Free Port (ZLC) in Panama consider the proposed tax reform would "have dire consequences".

Alberto Vallarino, Finance and Economics minister, said in regard to what they would pay: "its nothing, compared to their earnings".

"We are in talks with ZLC users. They don't want us to tax them, they don't want income declarations, but we need the money from this taxes", said the minister in a Prensa.com article.

Panamanian Government Presents Tax Reform

February 2010

Alberto Vallarino, Finance Minister, is expected to present the tax reform today to the president’s cabinet.

The main objective of this project is to remove the Alternative Calculation for the Income Tax.

Newspaper La Estrella obtained a preliminary draft of the reform. It specifies that individuals earning up to $11.000 a year would be exempt from paying income tax, while those earning between $11.000 and $40.000 would pay 15%.

Costa Rica drops tax reform

August 2008

The President of Costa Rica, Oscar Arias, ruled out pushing through a tax reform in the last two years of his presidency.

The Government of Costa Rica had planned to collect an additional $700 million a year by making some modifications to sales and income taxes, by taxing limited liability companies and creating a tax for financial transactions.

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