Updated: Jun 29, 2022
Panama has a number of taxes and regulations related to property ownership and usage. Property taxes are calculated considering the value of land, construction, and improvements to the property. The tax also applies to the declared value of vacant residential, commercial, or agricultural land. There are also regulations related to zoning and land use, which must be followed in order to avoid fines or penalties.
For family or primary residences:
0.5% to 0.7% is paid unless the property is valued at $120,000 or less, in which case the property is tax-free.
For all others i.e. vacant lots, commercial property, and vacation homes:
0.6% to 1% is paid unless valued at $30,000 or less, in which case the property is tax-free.
The seller is responsible for paying a transfer tax of 2% of the updated registered value (registered value + 5% per year of ownership) of the property or the purchase price (whichever is higher). In addition, there is a real estate commission that must be paid to the agent or broker involved in the sale.