Tax Advantages of registering a vessel with a Panamanian Flag
Since 1993, Panama has become the country with the largest ship registry in the world – and has steadily increased this record ever since. With the opportunity to register their ship under strict security measures, with the best technology and the most efficient legal support, the Panamanian maritime service allows you to save on the taxes that regulate the ship and the activity it carries out.
Apart from having extremely more competitive vessel registration costs than other jurisdictions, the maritime service in Panama allows all the activities of vessels are exempt from income tax or other types of tax. What is more, gains from the sale or transfer of a Panamanian vessel are exempt from taxes.
More recently, as per Law 25 passed in June 3, 2002, there is an additional discount of up to 25% on the Annual Tax and 50% on the annual consular fee for a term of four years. To do this you must have a group of at least four newly constructed ships representing 50 to 100 thousand gross tons registered provided that the owners agree to keep the ship in the Panamanian registry for four years.
However, the Panamanian maritime service offers not only fiscal advantages but also economic, commercial and administrative ones to the foreigners who decide to register their ship in this country. Here are some of them:
Regardless of their nationality, any natural or legal person can register vessels under the Panamanian flag.
Panamanian law allows the registration of any type of vessel: passenger ships and cargo, private yachts, tenders, etc.
The Panama Maritime Court has offices 24 hours a day to handle any maritime dispute which may arise.
There are no minimum tonnage requirements. However, ships with more than 20 years must carry out a special inspection by an authorized Panamanian inspector in order to obtain an obligatory patent.
When ship owners decide to transfer to Panamanian flag, the vessels don't need to be previously inspected. Owners should only submit the security certificate and tonnage passport issued by a recognized organization or society.