How Panama is Emerging as The Top Offshore Destination

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) June 12, 2010 -- With Uruguay facing uproar within the country for new taxation laws and the country already under pressure for more transparency in its banking and tax laws, the Republic of Panama continues to move ahead as the leading offshore destination.

Uruguay is hoping to be a member of the Organization of Economic Cooperation and Development – a 31-nation club consisting of the world’s top leading industrial states. To qualify as a member, it has to meet some very stringent transparency targets and Uruguay is hoping to do so by passing a new law that requires all residents to declare assets held even outside the country. Critics of this new law say that the government is planning on a very stringent tax regime and that it is not fair on any of its residents, regardless of whether they are citizens or foreigners.

A quick look reveals that deposits held outside the country by citizens as well as foreigners and asset holdings of non-resident companies could be affected by the impending legislation. Further, citizens who do take part in non-resident companies would be required to account for all the income tax and payroll tax that they have paid. When the bill comes into action, residents in Uruguay will have to declare their overseas income and pay income and wealth taxes on it. They will also have to declare their share of assets in investments overseas and pay taxes on income earned from them. This development also affects the privacy of the investors – the legislative changes also intend to place new requirements on bank accounts that were so far considered absolutely secret. According to the new changes, all information about bank accounts and deposits would remain protected by law but if a formal request made to a judge is approved, they may have to be revealed.

In contrast, the Republic of Panama still offers enormous tax benefits on income earned offshore. There is no tax on any income that has been earned offshore and the corporation is not required to file any tax returns if all the income was offshore derived. You could establish an offshore Panama Corporation, have an account in a Panama Bank and even maintain an office in the Republic of Panama - if all the income is from offshore sources, you do not need to pay any taxes.

Similarly, the Republic of Panama is also regarded as having one of the best banking secrecy laws even as of today. Panama is a signatory to The Mutual Legal Assistance Treaty but other than in cases where criminal activities have been suspected such as drug dealing, money laundering, terrorism and a few others, it is difficult to use this treaty to force a Panama bank to give up details on bank accounts held with them. Also, unlike many other offshore banking countries, Panama does not allow the MLAT to extend to tax issues. In fact, in the Republic of Panama, even in case of a divorce, bankruptcy or other similar events, the banking information is never revealed.

The Republic of Panama continues on its path of economic growth, attracting investors from the world over by offering attractive tax policies and strict banking privacy laws.

PMc Group Panama     Republic of Panama