Panamanian laws support foreign investment and are pro-business.

There are various laws in Panama that support foreign investment and are pro-business;

Law # 54: Foreign Investor Protection Law

Panama ‘s law 54 clearly states that foreign investors have the same rights as nationals in Panama:

  • Foreign investors in Panama and the businesses in which they participate in have the same rights and duties as national or local investors and enterprises, including those that refer to the freedom of trade and industry, and export and import.
  • Foreign or local investors in Panama are guaranteed the right to dispose of investment profits, the right to repatriate their capital, dividends, interest and profits produced by their investments and the right to commercialize their production.
  • Foreign investors are awarded a 10-year stability guarantee that all legal, tax, customs, municipal and labor rules will remain identical to those in force at the time of the investment registration.

Law # 24 : Reforestation Investment Law

Reforestation in Panama is actively being promoted and the Panamanian government has granted numerous incentives for foreign investors who purchase land for reforestation purposes, or reforested land. The reforestation investors benefits are the following;

  • Income tax exemption for 25 years.
  • Investors who invest a minimum of $40,000 can obtain Panamanian residency.
  • Reforestation has been designated as a top-priority investment and development industry.
  • The Panamanian government offers protection from “squatters” or persons seeking to damage reforested lands (this crime is classified as a felony).
  • The Panamanian government guarantees to promote and develop the reforestation industry with the intent to make Panamanian reforestation products more marketable and profitable.

Law # 8: Tourism Investor Incentive Law

The government of Panama is actively and aggressively promoting tourism on an international basis. As part of the program, the country has passed the most modern and comprehensive law for the promotion of tourism investment in Latin America and the Caribbean . The incentives of tourism investments are the following;

  • Property taxes (including land) are exempted.
  • Income tax is exempted for 15 years.
  • Import tax (including sales tax of 5%) is exempted for 20 years.
  • Financing interest is tax deductible for 20 years.
  • Exemption from liens due to the use of docks or airports built by the tourism entity.