In 1994 Panama passed Law No. 8, one of the most modern and comprehensive laws for the promotion of tourism investment in Latin America and the Caribbean.
Since the law was enacted, dozens of the world’s largest hotel chains have swept in to take advantage of it and invest in Panama and its future, including the Marriott, the Radisson, Holiday Inn, the Sheraton, and the Intercontinental. But Panama’s attractive tourism investment laws are not just for big business. Anyone willing to invest as little as $50,000 in a tourism project in Panama can take advantage of the enormous tax and financial incentives available here.
You could build a guesthouse in the town of Pedasi…start a charter-dive operation on Isla Iguana, or open a surf-board rental shop at Playa Venao…trek tour groups through the pristine Azuero's Highlands…open a marina in Playa Cambutal, a hotel, or a nightspot along the beaches of the Pacific coast…take tour groups through Azuero's countryside…open a riverside restaurant in Isla Canas… The investment opportunities in Panama are endless…
With a minimum investment of $50,000 in the Azuero Peninsula, Panama (or anywhere in Panama’s interior) you can receive: • 20-year exemption of any import taxes due on materials, furniture, equipment,and vehicles. • A 20-year exemption on real estate taxes for all assets of the enterprise. • Exemption from any tax levied for the use of airports and piers. • Accelerated depreciation for real estate assets of 10% per year.
And if you start up a tourism-related business in one of the specially designated tourist zones, you can also receive a 15-year exemption on your income taxes.
Points to Consider
The Republic of Panama is perhaps the ideal destination for investing, offering financial privacy and minimum taxes, corporate or personal . Its proximity to the growing Latin market makes it a natural base for world business operations, and in spite of its troubled history, it isn’t directly under the thumb of either the United States or the U.K.
Panama is a country in much better shape financially than its Central American neighbors to the north, or Colombia to the south. Annual inflation has averaged 1.4% for the past 30 years, and during the 1990s it barely exceeded 1% per year. Then there is the wealth represented by the Panama Canal. Its operations in 2001, according to the Panama Canal Authority, generated $630.8 million in total revenues, much of which was plowed back into constant maintenance. But the move that could turn the current flow of 14,000 annual ship transits into a flood is the widening of the canal and the building of bigger locks. More Panama Statistics...
There are also thousands of acres of land from former U.S. military installations, prized real estate with an estimated value of $4 billion. Admittedly, its distribution and privatization has been slow and marked by charges of corruption, producing few of the general benefits promised or anticipated.
LAW No2: Tourism Development and Island Property Sale
In January 2006 Panama passed Law No2 that regulates the concessions for tourism investment and the sale of island property for tourism development
