This law modifies Article 9 of Law 80 of November 2012, which was enacted to promote investment and foster financing for the development of new projects or expansions of existing investments in the interior of the country.
Law No. 122 of the 31st of December, 2019fosters investments by facilitating the capitalization of projects, thus serving as a fundamental tool to continue the development of the tourism sector in our country.
Both individuals and legal entities are entitled by this law to an income tax credit of one hundred percent (100%) for any amounts invested in bonds, shares or other financial instruments issued by tourism companies registered at the National Tourism Registry of Panama (ATP).
Tourism companies may invest in new projects or in expansions of existing projects located in the countryside and towns in rural areas of the Republic of Panama.
This incentive shall be available to investors who are not directly or indirectly affiliated with the tourism company that issues the financial instrument before December 31, 2025. It should be emphasized that only the investor who is the first to acquire the shares or financial instruments mentioned above shall be entitled to this tax credit.
The following are the conditions to be complied with in order to be entitled to an established tax credit, which may be used for a maximum of ten (10) years:
Bonds, shares and other financial instruments, on the other hand, must meet the following criteria in order to qualify for the tax credit provided by this law:
The Panama Tourism Authority considers that, by attracting new investments and improving the country’s tourism infrastructure, this incentive shall benefit the tourism industry currently affected by the worldwide pandemic.
Finally, the entire procedure for the recognition and application of incentives to investors in tourism companies was established by Executive Decree 364 of July 23, 2020.
Quijano & Asociados is at your disposal to assist you during the entire process of structuring and registration of Tourism Bonds or any other financial instrument at the Superintendence of Stock Market of Panama and its subsequent listing in a Latin American Stock Exchange.