Panama not a fiscal paradise

PANAMA. Faced with international pressure for structural changes in Panama’s financial sector, a group of the main financial professional associations in the country released a statement rebutting Panama’s denomination as a “fiscal paradise. ”

According to Panama’s Banking Association (ABP); the Chamber of Commerce, Industries, and Agriculture; the Association of International Lawyers; the Panamanian Maritime Law Association, the Panamanian Association of Business Executives; the Association of Commercial Law; and Panama’s Association of Trusts, there is an underlying assumption that no taxes are paid in the country or that these are paid at very low rates, and Panama is called fiscal paradise, allegations which are not true.

Panama has been receiving heat from US lawmakers and unions that claim that many of the factors that contribute to Panama’s economic growth also make it a sanctuary for tax cheats and money laundering, calling for reforms before a Free Trade Agreement with the United States receives Senate approval.

The associations believe Panama’s current fiscal policy responds to the realities of the country’s economy, which has geared its development towards international commerce and the provision of services to the world given its strategic location.

They argue the current legal framework to regulate financial activities allows authorities to supervise the industry and chase criminals adequately, as opposed to allegations by our Northern partner, and calls upon local authorities to reject threats of retaliatory actions if Panama does not agree to act in line with foreign interests.

They also ask the government to respond to calls for reform with a thorough implementation of existing laws and treaties.