Apply for property tax exemption
Earlier this year The National Assembly approved bill 509, which reforms Panama’s property tax laws. The new legislation offers a tax moratorium exclusive to real estate tax.
"The project constitutes the most important integral reform of the property tax (IBI) in the last 40 years and establishes a greater fiscal balance, which benefits the majority of the owners," said the Ministry of Economy and Finance (MEF).
President Juan Carlos Varela announced properties between $ 120 thousand and $ 300 thousand, will have an exemption of 3 years in property tax. Primary dwellings that have a value less than $ 120 thousand will have a permanent tax exemption.
According to the current regime, new residences receive a 20 year exemption if its value is less than $ 120,000; 10 years if the value is between $ 120 thousand and $ 300 thousand; and 5 years for those with a value greater than $ 300 thousand.
The bill offers significant reductions in property tax. Today, the highest rate is 2.10% for over $ 75 thousand. Until 2019, for the habitual residences, the highest rate will be 0.70% for over $ 700 thousand.
What should a taxpayer do to apply to the moratorium?
The procedure can be done both online and in person at the offices of the Directorate General of Revenue (DGI).
1) the taxpayer must verify that the finca information that appears in the National Land Authority (Anati) correspond with the values registered in the DGI.
3)fill out a form with finca info to tell the DGI you are accepting the moratorium. Once the form is entered, the system will generate a new statement of account in which accrued interest and surcharges will not appear.
This must be completed before December 31, 2017, the date on which the moratorium ends. Otherwise, interest and surcharges will be returned to the account.