Tier 1 · Forestry tax regulation
Executive Decree 170 of 1993 — Income Tax Regulation (forestry part)
Defines the specific tax treatment of forestry investments under the Panama Tax Code. Its forestry part operates alongside Law 24/1992 and Decree 89/1993. Some provisions lost effect when Article 7 of Law 24 was derogated by Law 69/2017.
Key forestry provisions
- Deductibility of forestry investment — historic 100% deductible-expense treatment (linked to Art. 7 of Law 24, now derogated).
- Income tax exemption on profits of registered plantations — for 25 years from registration (linked to derogated Art. 7).
- Requirements for investor to claim benefit — project registered in Forest Registry, plantation effectively established.
- Coordination with the General Directorate of Revenue (DGI) and environmental authority.
What still applies today?
Current state is complex: the operational regulation remains formally in force, but the articles of Law 24/1992 it regulated (6 and 7) were derogated in 2017. Prevailing interpretation: the forestry fiscal part of Decree 170/1993 does not apply to new plantations registered after October 2017, save for vested rights of earlier projects. Current regime for new investments is direct subsidy from the Reforesta Panamá Fund (Law 69/2017).
Complete analysis · Decree 170 of 1993
Applicability analysis by project registration date, vested rights doctrine in Panamanian forestry tax matters, and comparative regime with Law 69/2017.
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