Court puts Bosco’s city tax plans on hold

(PanamaNewsRoom) Mayor Bosco Vallarino and his advisor’s plans to levy new heavy taxes on Panama city businesses have been put on hold by the Supreme Court.

On Wednesday the controversial new tax tables were provisionally suspended.

The news impositions have been vigorously opposed by business organizations and by Panama’s Ministry of Finance.

Judge Alejandro Moncada Luna said that the decision is not final  and that the court will issue its reasoning  about the legality or illegality of the tax agreement.

The court said that the suspension of the municipal agreement relates to with the application for annulment filed by the State through the Ministry of Economy and Finance (MEF).

According to the lawsuit, the application of new taxes in Panama leads to the taxpayer being taxed twice, by taxing income already the subject of a national tax, contrary to the prohibition of double taxation.

Jose Blandon, “honorary” advisor to the mayor, and a deputy in the ruling coalition, who is at odds with Finance Minister Alberto Vallarino, the said that the position of the MEF is "absurd" because it "amounts to saying that municipalities cannot tax business activities."