Here in Panama, whoever you are, you pay your property tax on a graduated rate. I may not remember the rates exactly and I could be a bit dated with my information, but I can give you an idea. You pay nothing up to $30,000 of value. From $30,000 to $50,000 you pay something close to 1.25%. From $50,000 to $100,000, you’ll pay around 1.5%. The rate just keeps going up like that. So, using the example of the $300,000 house, in a very rough range, you may pay approximately $6,000 a year of property tax. However, the property tax you pay tends to stay at around what you purchased the house for. They don’t have a lot of folks that go out to do tax assessments. They’re talking about doing a re-assessment, but it’s going to take them year to do in the city, and I don’t know when are we going to get around to doing it in the interior.
There has been a 20-year exemption on property tax if you build. Let’s say you paid $50,000 for your lot and you build a $150,000 house. For 20 years you won’t pay anything on the $150,000. You just pay taxes on the value of the lot (in this example, $50,000), and not for the improvements to the lot for 20 years. At the end of 20 years, then you start paying the full value, in this example, the $200,000. This exemption may have changed recently, so if you plan on using it, please check for the most current status of the law.