Panama tries to grow its economy
By Peter Mindenhall

Upscale Panamanian property in need of revaluation

Panamanian property in some upscale areas is in desperate need of revaluation. Finance Minister Frank De Lima told Newsroom Panama that in certain locations, this hasn't been performed in decades, despite the fact the government is now trying to standardise the tax process in the country and is reevaluating the price of real estate nationwide.

The current programme of revaluation conducted by the Ministry of Economy and Finance has been going on for two years, but some factions in Panama are against the process, the news provider explained. What's more, Panamanians have just 15 days to appeal the outcome of a revaluation, which could cause their taxes to rise. Despite resistance, Mr De Lima stressed that the process will now be performed in specific neighbourhoods in Panama City and Colon - most of which will be areas classed as prime.

As Panama tries to grow its economy, lots of focus has been placed on transforming the property market. The country is set to make changes to its tax code to stimulate greater investment activity. Newsroom Panama revealed the government has given the OK to amend the code that creates a tax incentive for real estate investment companies. The National Assembly will receive the changes from the minister of the economy and finance and when passed, the way real estate investment is approached will be altered.

Under the reforms, property in the country will be submitted to a similar tax regime as that employed in the US, Spain and Costa Rica. The news provider explained that this will give all types of investors equal direct exposure to the housing market. This means buyers of all capacities will be able to benefit from good liquidity and transparency.

To achieve this, a vehicle will be created to help investors purchase property on a scale that may have normally been out of their reach. Newsroom Panama recounted how this is expected to lead to new alternatives for funding, moving away from the bank loan culture of investment.
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