Your next conference, convention, or business meeting in Panama can be highly beneficial for US-based companies. And we are not referring in this case to the benefits related to the modern infrastructure, aerial connectivity or to the relaxed environment the country offers.
The truth is that, since 2011, thanks to the “Agreement Between the Government of the United States of America and the Republic of Panama for Tax Cooperation and the Exchange of Information concerning Taxes”, expenses incurred by US-based companies related to the organization of business conventions, conferences, and meetings in Panama, are tax-deductible.
According to the aforementioned measure, companies simply need to gather and keep all pertaining documentation to request a deduction in their income tax statements. The measure, known as Revenue Ruling 2011-26, considers the Republic of Panama as part of the “area of North America” for tax purposes.
The agreement is, therefore, one of the most recent benefits Panama offers to facilitate international business activities, the first one being the use of the US dollar as legal tender, which is permanently at par with the Panamanian balboa (used de facto on the Isthmus since the mid-19th century, and de jure since 1904). Said measure, which was established to facilitate transactions related to the construction of the Panama Canal, prevents the typical, inflation-related fluctuations that are common in other parts of the region.