This huge and a real game changer for property owners in Panama. If you own a primary residence with a registered value of $120,000 or less, you pay no real estate taxes – Forever!!! Plus, any amount from $120,000 up to $700,000 will be taxed at only one half of one percent. That means that an owner of a home that is his primary residence, it has a registered value of say $300,000 and it no longer enjoys a real estate tax exoneration, then he will pay only $900 per year in real estate taxes. Prior to this new law, he would have to pay almost $6,000 per year!
From a press release by the Assembly:
The regulations mainly extend the coverage of tax exemptions to residences that do not exceed 120 thousand balboas and those that exceed this price will pay less taxes. Money collected from this tax will be given to municipalities to secure resources for decentralization.
Having been established, the progressive rate combined with the tax benefit known as family property tax or the main dwelling will be:
1. 0.00% on the taxable base from zero balboas up to B / .120,000.00.
2. 0.5% on the taxable base over B / .120,000.01 and up to 700 thousand.
3. 0.7% on the taxable base over 700 thousand balboas.
The combined progressive rate on commercial real estate, industrial, other residences and others is as follows:
1. 0.00% on the taxable base from zero balboas up to B / .30,000.00.
2. 0.60% on the taxable base over B / .30, OOO.01 and up to B / .250,000.OO. 0.80% on the taxable base over 250 thousand and up to 500 thousand.
3. 1% on the taxable base over 500 thousand.
Read full release (in Spanish).
Questions:
1. When does this take effect?
2. Will there still be a 20 year exoneration on new construction?
3. Who does the evaluation of the property? Will there be tax assessors like in the USA?
Thank you for any light anyone can shed!