The Panamanian government has introduced a bill that would partially exempt the first sale of new homes from the Real Estate Transfer Tax, known as ITBI. The Cabinet approved the proposal on July 29, 2026.
Under the current proposal, the first B/.120,000 of the sale price would be exempt. Among the conditions is that the transaction must be the first sale of a new home and must take place within two years of the issuance of the occupancy permit. For properties valued between B/.120,001 and B/.200,000, only the amount above B/.120,000 would be taxed according to a preferential scale.
The proposal also states that the tax must be paid by the seller. Agreements attempting to transfer this obligation directly or indirectly to the buyer would be invalid.
For property buyers and investors, the proposal is relevant because it could change the tax framework for purchasing newly built homes. However, it is still only a bill and is not yet in force. Its provisions may therefore change during the legislative process.
Relevance: Anyone planning to buy a new home in Panama should keep the potential tax relief in mind when estimating costs. Because this is still a bill, it should not be treated as a benefit that is already in effect.
