There are several reasons why expats call Panama their (second) home. A few key reasons are;
1. Low Cost of Living:
Panama's cost of living is significantly lower compared to Europe and the Northern Hemisphere according
to a recent Global Cost of Living survey by The Economist. A typical Panamanian Salary is between
$1000.00-$2000.00 per month, so one can live happily. But of course this depends on your lifestyle.
In order to afford a lifestyle compared to living in a mid-size city in the United States you can expect the
total cost to be 25% less – One of the many reasons to move to Panama.
2. Income tax rates are lower than Europe and most countries in the Western Hemisphere.
Income earned outside of Panama is tax free. Panama imposes a 25% corporate tax on corporations that enjoy tax deductions similar to the United States. Employees and self-employed workers in Panama who earn less than $11,000.00 US Dollars are not subject to income taxes.
Employees and self-employed workers who earn between $11,000.00 and $50,000.00 US Dollars only pay a low tax rate of 15%. Those who earn $50,000.00 or more pay a flat tax rate of 25%. Growing and Stable Economy – Panama has a strong economy, which was not affected by the world economic crisis. In fact, the economy of Panama has grown by an average of 8% (GDP) during the last five years.
3. Safe Haven for Foreign Investments
Article 44 of the Constitution of Panama protects private ownership of real estate and private investments. The Civil Code of Panama guarantees equal application of the law for Panamanian and foreign citizens, including leases and commercial contracts.
Panama even has a Foreign Investor Protection Law (Law 54 of 1998) providing equal rights to all
foreigners in all matters of trade, industry, import and export business. Panama guarantees that foreigners
can dispose of their investment profits as they see fit, including repatriating their investment funds and
profits to other countries with the unobstructed right to market their products in Panama. This is a great
incentive for foreigners looking to relocate to Panama.
4. Cheap labor
Panama's labor laws, and the cost of hiring Panamanians compared to Europe, Canada
and the United States is much lower, where the minimum wage in Panama City is $624.00 US dollars per
month. Commercial leasing is cheaper too. And it is very easy to start a business in Panama.
The 2010 Latin Business Index published by the Latin Business Chronicle website named Panama as the
number one place “Best place to do business in Latin America”.
5. Panama has an excellent infrastructure with good quality roads and highways that connect the Atlantic and Pacific Oceans and the interior of the Republic. Panama City has made great strides in public
transportation, modernizing public buses, creating a new Metro line, and the second line of the Panama
Metro is under construction.
The expansion of the Panama Canal will be completed in mid-2016, allowing the handling of larger ships.
Almost all national and international airports have been or are being renovated thus allowing more airlines and international connections. Similarly, new airports have been built to accommodate domestic flights around the country.