Panama: Personal Taxation
Value Added Tax
VAT (impuesto a la transferencia de bienes corporales muebles) is a tax on consumers imposed on transfers of personal property by sale or otherwise, and also applies to imports. The taxable value is the price paid plus ancillary charges, or in the case of imports, the customs value plus customs charges. The rate is generally 7% (5% prior to July 2010), but a higher rate of 10% applies to accommodation and alcoholic beverages, and a 15% rate applies to tobacco-related products.
Exports are zero-rated. Exemptions include food, medicine, agricultural raw materials, fuel and books.
Panama also imposes excise taxes on several products and services at 5%. Items covered by the excise tax include cars, motorcycles, cable television, pre-paid cellular phones, insurance premiums and airfares.