Foreign-Owned Call Centers in Panama. The Panamanian Call Center Regulation Law (Law No. 54 of October 25, 2001) provides tax and other special economic zone benefits to call centers established in Panama by foreign investors.
Tax Exemption. The 2001 law eliminated the normal telecommunications tax (enacted in 1961) on all international calls from Panama. See Law No. 88 of December 28, 1961 (telecom taxation law). However, the special tax exemption is limited to foreign companies who have “commercial use” call centers based in Panama. The exemption was enacted to lift an impediment to establishment of call center outsourcing in Panama. It does not exempt foreign-owned call centers from the duty to comply with local income tax and employment laws governing local operations.
Special Economic Zone. In addition, the law treats such call centers as “Export Processing Zones” entitled to special benefits but subject to special obligations. See Law 25 of November 30, 1992 on Export Processing Zones (as amended by Law 28 of February 1, 1996 and Decree Law No. 3 of January 7, 1997).
The benefits from Export Processing Zones include:
- Exemption of all sales income tax
- Exemption of national taxes imposed
- Special vacation schedules
- Market fluctuations as justification for the termination of contracts
- No import tariffs
- a special employee stability regime
- and resident visas for expatriates
Since the enactment of Call Center Regulation Law, Panama has become a competitive target for the establishment of call centers by foreign companies. Thousands of new jobs have been created. Companies such as Dell, National Asset Recovery Services (NARS), and Sitel have large call centers operating within Panama.
Official Sites:
http://www.asep.gob.pa/default.asp;
http://www.asep.gob.pa/leyes_decretos/ley54.asp
Other sites: www.sitel.com