Paraguay is the best alternative taxes
Paraguay is the best alternative for investments
Tax system simple and easy to pay very low taxes compared to Brazil and Argentina.
Tax and labor regimes of Paraguay are simple, which makes the country more competitive than
Brazil, which has a complex system.
Paraguayan tax system has basically two main taxes: the tax on business income and IVA
(Impuesto al Valor Agregado) value added tax
This simplicity makes it very easy to do business in Paraguay, because is there much clarity of taxes
that one actually has to pay once you are operating on a daily basis. Also, there are no limitations
for the entry and exit of capital.
Regarding the tax cost for various operations, when profits are not distributed and reinvested
again, the cost is 10%, if profits are distributed to local partners who are not contributors personal
income tax, the total cost is 14.5%, if profits are distributed to local partners taxpayers IRP
(Personal Income Tax) is 19.5%, if profits are remitted to foreign partners, not domiciled in
Paraguay is 27,3%.
In comparison to the region, Paraguay has the most favorable tax system in the region, with a tax
on business income of 10%, compared to 15% in Brazil, 17% in Chile, 25% in Uruguay, 35% in
Argentina and 34% in Venezuela
Paraguay is one of the countries with the lowest tax burden in Latin America, with 11.8%
compared to 26.7% in Brazil, 25.5% of Argentina, Bolivia 19.9%, 19.5% Chile and Uruguay 17.1%.
Other tax benefits, as provided by Law 523/05, which authorizes and sets the Free Zone System,
and provides for the exemption from VAT and from all national taxes or departmental; assimilable
treatment to exports and tax of 0, 5%.
Law 60/90, tax incentives for capital investment both domestic and foreign origin, and has
provided exemption from all kinds of internal taxation to incorporation of companies and
enterprises, customs levies, release of bank reserve requirement or special deposits, taxes on
distribution of dividends and remittances when the investment was less than $ 5,000,000