This special regime is aimed at attracting and promoting the production or transformation of matter, the creation of products or components, their logistics, development and research. The requirements for the EMMA license were established by the Multinational Company Headquarters Licensing Commission through Resolution 039-20 of December 23, 2020 and its was regulated el February 4, 2021 according to Executive Decree No. 33 of February 4, 2021.
Tax benefits for Companies
Reduced Income Tax Rate: Companies holding a Multinational Company License for the Provision of Services Related to Manufacturing must pay income tax in the Republic of Panama on the net taxable income derived from the services provided to a 5% fee. The EMMA company must settle and pay the income tax through the annual income tax return, and may include within their deductible expenses expenses incurred for labor remuneration of all its employees, in accordance with the provisions of the Tax Code.
Tax on the Transfer of Movable Corporal Assets and the Provision of Services: As they are export services, they will not cause Transfer Tax, provided that they are provided to entities of the business group abroad, that do not generate taxable income within Panama.
Companies with Multinational Company Licenses for the Provision of Services Related to Manufacturing will be exempt from the payment of the transfer tax on movable tangible assets and the provision of services for the purchase and importation of goods or services in the Republic of Panama.
Exemption from import tax: The EMMA company will be exempt from all taxes, fees, charges or import duties on all types or classes of merchandise, products, equipment and other goods in general, including, but not limited to, machinery, materials, containers , raw materials, inputs, supplies and spare parts that are used or required for the execution of the provision of services related to manufacturing.
Establishment anywhere in the national territory: EMMA companies may establish themselves in a special economic area in the national territory, free zone, free zone or establish a customs control and surveillance area.
Dividend and complementary tax and branch tax: Companies holding a Multinational Company License for the Provision of Services Related to Manufacturing will be exempt from paying the dividend tax, the complementary tax and the branch tax, without distinction. whether they are from local, foreign or exempt sources.
Fiscal Equipment: Companies holding a Multinational Company License for the Provision of Services Related to Manufacturing will not be subject to the use of fiscal equipment.
Capital Gains: The gain or loss on the transfer of shares issued by the EMMA company are subject to the capital gains regime, but at a fixed rate of 2%, where the buyer will have the obligation to withhold from the seller a sum equivalent to 1% of the total value of the sale.
Notice of Operation: Companies holding a Multinational Company License for the Provision of Services Related to Manufacturing will not have the obligation to obtain a Notice of Operation for the provision of the services established in this Law; Consequently, they will not be subject to the payment of the Operation Notice Tax.
Tax Benefits for Executives
Exemption from income tax: Those salaries and other labor remuneration, including salary in kind, received by persons holding a SEM Visa, in the to the extent that said salaries and wages are paid, assumed and recognized as personnel expenses in the accounting of the company with a SEM License.
Exemption from import tax for household goods: The holder of a Multinational Company Headquarters Permanent Personnel Visa will be exempt, at the time of moving to the Republic of Panama for the first time, from the payment of taxes due to its importation. could apply to your household goods.
Exemption from motor vehicle import tax: Foreign personnel covered by a Multinational Company Headquarters Permanent Personnel Visa may apply to the National Customs Authority for a total tariff exemption and only once, every two years, for the importation of a motor vehicle for your personal or family use.
The EMMAs will be able to hire the necessary number of trusted personnel and senior management executives to carry out their operations in Panama. Dependents who wish to work may change their immigration status through the Single Window at the Ministry of Commerce and Industry.
The EMMAs may agree with their workers on the mandatory weekly rest day, which will not necessarily be Sunday. When Sunday is a regular work day, there will be no surcharge.
Work on the agreed weekly rest day is remunerated with a 50% surcharge on the salary.
Work performed during overtime or overtime will be remunerated with a single surcharge equivalent to 25% of the salary of the workers of a Multinational Company for the provision of services related to Manufacturing.
The activities carried out by companies with Multinational Company Licenses for the Provision of Services Related to Manufacturing, authorized to operate in the Republic of Panama in accordance with Law 159 of August 31, 2020, will be considered as acceptable investments and susceptible to obtain the guarantees referred to in article 10 of Law 54 of 1998, regulated by Executive Decree 9 of February 22, 1999.
For companies that obtain an EMMA License, said legal stability operates automatically.
EMMA may locally sell the waste generated by the manufacturing process for recycling by third parties. Said transaction will not be subject to the payment of income tax.