By now, you have read a myriad of news stories about the change in the Panama tax law that lasted all of 24 hours…and even though the law to tax EVERYONE for EVERYTHING has been repealed…as one colleague puts “the damage is done in Panama.” Actually, one colleague and every single newsletter I subscribe to, and then some, say the same thing.
On December 30th, Panamanian President Ricardo Martinelli passed a law (Law 120) which made all (yup…ALL) income, worldwide, taxable! Essentially eliminating Panama from the list of viable and legal tax havens…on Tuesday, December 31st a letter was written requesting that the 2 articles of the Law 120 be revoked; this request was accepted by the president and the letter can be seen here on the Presidential website. Oops! Sorry guys…that was a mistake! And the damage was done…but do not panic! Even if you have money or a business or a trust set up there…it’s all good…for now!
This does however, open the door for some serious consideration if you have funds offshore and/or a business established offshore…even if it is NOT in Panama. To quote my buddy Dave in Belize “As the world grows smaller, and the big governments spend beyond their means, their need to raise taxes grows and along with that comes pressure on the tax havens to put them out of business.” Dave goes on to say how important it is to have a backup plan in place REGARDLESS of how safe and secure you feel you are with your current structure.
One nation which has not succumb to these pressures and continues to remain strong is Belize…to learn more about Belize as an integral part of your offshore strategy, click here or use the contact us form in the right column. While some people moved their companies out of Panama overnight when the news hit, there is no need to panic at this point (and I’m not saying those people did, I commend them for being in tune), but if you have a company established there it could be time to look for an alternative…and if you have been considering an IBC in Panama I would definitely recommend Belize or Nevis first.
As for Panama…whatever you do…don’t panic!
Hit ‘em straight!
