Panama
| Pros |
|---|
| Territorial taxation system exempting foreign-source income from local levies. |
| Official use of the US Dollar ensuring monetary stability and preventing local currency devaluation. |
| World-class logistics infrastructure and strategic geographic position for global trade operations. |
| Cons |
|---|
| Persistent systemic corruption within the judicial and administrative branches of government. |
| Complex banking regulations due to international pressure and inclusion on various financial grey lists. |
| Significant bureaucratic hurdles and slow administrative processes for business licensing and permits. |
Will Panama tax what you earn?
YES, A LOT. On paper, Panama taxes personal income at 25%. In practice, the territorial regime puts only locally-sourced income in scope: foreign salary, foreign dividends, foreign capital gains are left alone. The headline scares; the design doesn't. For anyone whose income arises abroad, the effective rate collapses.
Will Panama tax what you own?
YES, BUT LIGHTLY. Panama taxes capital gains lightly (10% at the top), with no annual wealth charge and no inheritance regime. A held portfolio compounds with minimal friction; the state only shows up at disposal.
Is it easy to run a company in Panama?
NO. Corporate tax in Panama is 25% with no IP-box relief, on top of VAT at 7. Running a company here is operationally fine but fiscally expensive: the state takes a large bite of every unit of profit.
Is Panama good for your holding company?
YES. Panama offers a moderate treaty network (18 signed) paired with a full participation exemption (100% on qualifying dividends and gains). A respectable holding jurisdiction. Not in the NL/LU/SG elite tier on treaty count, but the through-flow is clean.
| Country | Status | Dividends | Interest | Royalties |
|---|---|---|---|---|
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| ∅ // no treaties match | ||||
What does it cost to come and go from Panama?
LITTLE. Coming and going from Panama is cheap. The country runs a territorial system (foreign income stays foreign), and there's no exit tax on departure. You leave with what you came in with, plus whatever you earned abroad while you were here.
Will Panama protect your privacy?
NOT AT ALL. Panama is a signatory to every major automatic-exchange framework: CRS, FATCA, CARF, MLI, MAAC. Financial accounts here will be reported to your home tax authority (Americans: FATCA is in force). Corporate registries stay non-public, returning a thin layer of opacity on the ownership side, but the financial trail is fully visible.
Is Panama itself a liability?
YES. Panama sits on multiple major blacklists. Counterparties routinely apply anti-abuse rules, higher withholding, or refuse the transaction entirely. The jurisdiction itself is the risk, regardless of the substance of what you're doing inside it.
Will you feel free in Panama?
PARTLY. Panama scores in the middle band of the RSF press-freedom index (rank #53): civil society operates but the boundaries are real. Crypto sits in the standard regulated tier.
Other jurisdictions worth comparing
Picked by similarity of strategic profile to Panama. No editorial ranking — neighbours in the same scoring space.