Cryptocurrency is legal in Panama and currently treated as intangible property under the country's general tax laws. There is no specific, dedicated legal framework for crypto assets, meaning existing fiscal regulations apply. Practically, the Municipality of Panama has begun accepting crypto for local tax payments. The Dirección General de Ingresos (DGI), which is Panama's tax authority, is responsible for general tax administration and applies the existing fiscal rules to cryptocurrency activities. Panama operates on a territorial tax system, which is the cornerstone of its crypto tax landscape. This means that all foreign-sourced crypto income is exempt from taxation. Individuals pay 0% tax on foreign-sourced crypto income, with progressive rates up to 25% only applying to income generated within Panama. Similarly, capital gains from crypto are 0% if foreign-sourced, if Panama-sourced, they are taxed at ordinary income rates. Corporations pay 25% tax on Panama-sourced profits but 0% on foreign-sourced crypto profits. An alternate 4.67% gross basis applies to corporate profits exceeding USD 1.5 million. There are no specific holding period benefits, all foreign-sourced gains are exempt regardless of how long the assets are held. The application of Value Added Tax (known as ITBMS) at 7% to crypto transactions is unclear, with no specific official guidance. Converting crypto to fiat or swapping crypto-to-crypto is not taxable if foreign-sourced, if Panama-sourced, gains are calculated under general income rules. Specific crypto activities like staking, mining, Decentralized Finance (DeFi) yields, and Non-Fungible Token (NFT) sales also adhere to the territorial principle. Income from these activities is not taxable if foreign-sourced. If Panama-sourced, staking and DeFi yields are taxed as ordinary income. Mining, if Panama-sourced, is considered business income, with associated expenses being deductible. NFT sales, if Panama-sourced, are treated as sales of intangible property. A significant legislative development is Bill No. 247, which was introduced on March 20, 2025. This bill is currently under subcommittee review as of September 30, 2025, and proposes to establish a special crypto tax regime with potential incentives, which could materially change the current framework.
Tax Rates
| Effective individual rate | 0 |
| Capital gains tax | 0% (foreign-sourced), ordinary income rates if Panama-sourced |
| Income tax on crypto | 0% (foreign-sourced), up to 25% (Panama-sourced) |
| Corporate tax | 25% Panama-sourced, 0% foreign-sourced, 4.67% alternate gross basis |
| VAT | Unclear, no specific crypto guidance, potential ITBMS 7% application unresolved |
Activity Taxes
| Staking | 0% (foreign-sourced), taxed as ordinary income if Panama-sourced |
| Mining | 0% (foreign-sourced), business income if Panama-sourced, expenses deductible |
| DeFi | 0% (foreign-sourced), taxed as income for yields if Panama-sourced |
| NFTs | 0% (foreign-sourced), intangible property sales if Panama-sourced |
Taxable Events
| Crypto → Fiat | Not taxable if foreign-sourced, gain calculation per general rules domestically |
| Crypto → Crypto | Not taxable if foreign-sourced, territorial income rules apply domestically |
Holding Period
| Holding period benefit | None, all foreign-sourced gains exempt regardless of holding period |
Sources