ITBI Set to Zero on New Homes: The Door Panama Is Opening to Buy for Less in 2026

Panama's Ministry of Economy and Finance has submitted a bill to the National Assembly to eliminate the ITBI (Panama's real estate transfer tax) on the first sale of new homes priced up to $120,000, with a reduced rate for homes priced between $120,000 and $200,000. It is not yet law: the Economy Committee suspended the first debate, pending a second key piece of the bill.

Why Netflix, Airbnb, and Amazon are part of this story: Panama's Constitution requires that if the State stops collecting one tax, it must present another source of revenue to offset it at the same time. The Government is proposing that this revenue come from charging the 7% ITBMS (Panama's VAT-equivalent tax) on digital platforms that currently bill from abroad without that tax. In other words, the benefit for new-home buyers would be funded by what starts getting charged on subscriptions and online purchases.

For a first-time homebuyer, it's a real savings at closing if the purchase is formalized within two years of the occupancy permit. For a developer, it redefines how to structure pre-sale pricing. For an investor, it's a signal that the State wants to reactivate demand for mid-range housing. CAPAC has already backed the initiative; it's worth following its progress before signing a purchase-sale promise agreement.

Are you considering buying or developing in this price range? At MAKOM Capital Group, we analyze how this reform could affect your next decision. Let's talk.