Taxpayers stand to benefit from tax amnesty

PANAMA CITY - Nov. 9, 2019 - PRLog -- New President Laurentino Cortizo signed into law a general tax amnesty under Law 99 of 2019.   This is a general tax amnesty covering all taxes administered by the DGI are included, such as:

- Income tax

- Property Tax

- Annual Flat Tax (in Spanish Tasa Unica).

The tax amnesty would benefit owners of corporations and private interest foundations formed in Panama who must pay a US$300 Annual Flat Tax ($400 for private foundations). Resolution No.5 of 2016 of the National Bar Association further provides every year for a US$250 Resident Agent Fee, and - if the client requests - a US$300 nominee director fee, and $1000 Legal Representative Fee.

Alvaro Aguilar Alfu, partner at Lombardi Aguilar Group (www.laglex.net) , specializing in Real Estate and Tax Law, said "taxpayers or their resident agents should have by now access to the e-Tax2 website in order to take advantage of the amnesty. Those who do not have updated passwords or have outdated information in the website may have to stand in line for several hours to request access".  He added that "the amnesty provides an opportunity for taxpayers to save on fines due for placing on good standing companies or foundations for planned mergers or redomiciliations to other jurisidictions, dissolving those which have become a liability for their directors or beneficiaries or apply for changes in title or appraised value of real estate properties.

In the municipality of Panama City, Municipal Agreement number 208 of October 15, 2019, was also enacted whereby the city council established a moratorium for the payment of taxes, duties, fees and municipal fines when paid by November 30, 2019.

Aguilar pointed out that companies doing business in Panama may have been accruing unpaid municipal taxes without knowing by having a physical presence in Panama. "Despite the misperception of Panama as a tax haven, companies – even foreign-owned ones – which have a business license for any reason, are likely to owe municipal taxes. Left unattended, these taxes can run into thousands of dollars and the client must file yearly municipal tax returns by each March 31 to avoid overtaxation."

Mr. Aguilar is a graduate of Universidad Santa Maria la Antigua (LLB) and Washington College of Law at The American University (LLM). He has 20 years of business law experience on behalf of local, European and U.S. companies doing business in Latin America.

For more information or the free text of Tax Amnesty Law 99 of 2019 and Municipal Agreement 208 of 2019, contact +507 340-6444, e-mail aaguilar (at) laglex.com, or see: Lombardi Aguilar Group http://www.laglex.com/ and our social media updates.