One of the main incentives to buy property in Panama was the 20-year property tax exemption law, first passed in 1990 to encourage economic development and investment. The exemption freed buyers of new homes or condos from paying property tax for up to 20 years.<\/p>\n
The exemption had been extended several times, but finally expired Aug. 31, 2007. The government introduced new exemptions of five to 15 years, depending on the value of the property. Though real estate companies, construction companies, and developers lobbied for the return of the 20-year blanket exemption, the government refused. Until now…<\/p>\n
The government of Panama had a change of heart. On Saturday, December 22, Housing Minister Balbina Herrera extended the 20-year tax exemption until December 31, 2009.<\/strong> “We are doing this not only because the construction sector is important to the national economy, but also because 95% of the new construction is for nationals and only 5% for foreigners,” said the Minister, seemingly in response to critics claiming the exemption benefits wealthy expats rather than the struggling Panamanians it was intended to help.<\/p>\n Bottom line: if construction on your new residential property is complete by December 31, 2009, you won’t pay property tax for 20 years from the date of completion.<\/strong><\/p>\n Even if you buy a resale, the remaining exemption time is transferred to you. For example, if you buy a residential property that was built in 2000, you won\u2019t pay property tax on it until 2020.<\/p>\n Just remember, land itself is not exempted and will continue to incur property taxes if its value is above $30,000.<\/p>\n P.S. If you’ve been planning to buy property in Panama, this new exemption extension is reason enough to get moving and make it happen. Start the new year with concrete plans to finally visit Panama and see for yourself why we’re so keen on it.<\/p>\n","protected":false},"excerpt":{"rendered":" One of the main incentives to buy property in Panama was the 20-year property tax exemption law, first passed in 1990 to encourage economic development and investment. The exemption freed buyers of new homes or condos from paying property tax for up to 20 years. The exemption had been extended several times, but finally expired … Continue reading Panama Rocks! Tax Exemption law is back!<\/span>