There are always pro's and con's when it comes to giving tax incentives or not, Panama is no exception. read on.
A bill is being prepared that introduces incentives for organizing conventions and 20 year tax exemptions for hotels investing at least $20 million and who register within three months after the law’s approval.
This week, the National Assembly made public bill number 125 which "establishes rules for incentives to tourism in Panama", after a year of talks between the private sector and government.
On becoming law, new hotels in the capital district who have invested at least $20 million will be exempt for 20 years from import duties on materials, furniture and equipment. To qualify for the exemption, new premises will have to register within three months of the law’s enactment.
The domestic private sector had asked for tax benefits not to be reactivated after the expiration of the last period stipulated by tourism law number 8 of August 1994, which was valid until December 31st, 2008, a request which has been ignored in the proposed law, reports Prensa.com. This led to investments reaching close to $2 billion between 2006 and 2008, when investors bet heavily on the development of tourism.
"Regarding the idea of reviving benefits for construction in the capital city (if only for a short period), some hoteliers are talking about a possible saturation. With the opening in the coming months at least 15 hotels, representing about 5,000 new rooms, worried hoteliers believe that by promoting incentives they will encourage more construction which at the moment is not needed," reported Prensa.com.
On becoming law, new hotels in the capital district who have invested at least $20 million will be exempt for 20 years from import duties on materials, furniture and equipment. To qualify for the exemption, new premises will have to register within three months of the law’s enactment.
The domestic private sector had asked for tax benefits not to be reactivated after the expiration of the last period stipulated by tourism law number 8 of August 1994, which was valid until December 31st, 2008, a request which has been ignored in the proposed law, reports Prensa.com. This led to investments reaching close to $2 billion between 2006 and 2008, when investors bet heavily on the development of tourism.
"Regarding the idea of reviving benefits for construction in the capital city (if only for a short period), some hoteliers are talking about a possible saturation. With the opening in the coming months at least 15 hotels, representing about 5,000 new rooms, worried hoteliers believe that by promoting incentives they will encourage more construction which at the moment is not needed," reported Prensa.com.
Source: Prensa.com
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