Summary.
The draft bill seeks to amend Article 712 of the Tax Code of the Republic of Panama (Código Fiscal de la República de Panamá) to align it with Article 2, paragraph 9, of Law 280 of December 2021 (Ley 280 de diciembre de 2021). Its opening article connects that amendment with the repeal of Articles 85-A and 90-C of Executive Decree 170 of 1993 (Decreto Ejecutivo 170 de 1993), regulated through Executive Decree 182 of October 2021 (Decreto Ejecutivo 182 de octubre de 2021). The proposal thus addresses endorsement of income tax returns and other tax filings by reference to the cited provisions on authorized public accounting.
The proposed wording of Article 712 would require an Authorized Public Accountant to prepare and endorse income tax returns for taxpayers engaged in activities of any kind whose capital exceeds eleven thousand balboas and one cent (B/.ll,OOO.Ol). The same requirement would apply to taxpayers whose taxable income exceeds eleven thousand balboas and one cent (B/. 11,000.01). These are separate grounds for the requirement: one concerns the taxpayer’s capital, while the other concerns taxable income. Article 712 would also provide for a fine of twenty-five balboas (B/.25.00) to one thousand balboas (B/. 1,000.00) when an Authorized Public Accountant enters false information in an income tax return. That fine would be without prejudice to the penalties established in Law 280 of 2021 (ley 280 de 2021). The General Directorate of Revenue (Dirección General de Ingresos) would impose the fines.
The draft bill then reproduces the provision it attributes to Article 2, paragraph 9, of Law 280 of 2021 (Ley 280 de 2021). That provision concerns endorsement of sworn national and municipal income tax returns, and filings for other taxes, where the gross amount to be declared exceeds eleven thousand balboas (B/. 11,000.00). It covers natural and legal persons and the corresponding attachments. Under the quoted provision, the relevant ministry would accept only returns and attachments endorsed by an Authorized Public Accountant. On that basis, Article 3 directs the repeal of Articles 85-A and 90-C of Executive Decree 182 of October 2021.
The draft bill further provides for the repeal of all provisions that oppose or contradict the proposed law. It assigns the making of implementing regulations to the Executive Branch (Órgano Ejecutivo) and would take effect upon publication in the Official Gazette. Its subject matter involves the General Directorate of Revenue, the Executive Branch and the relevant ministry identified in the quoted provision. It would affect Authorized Public Accountants, taxpayers who are natural or legal persons, and economic activities subject to income tax returns or other tax filings in the Republic of Panama.
What it proposes.
- Preparation and endorsement of income tax returns.
- Capital and taxable income thresholds requiring an Authorized Public Accountant.
- Fines for false information and repeal of regulatory provisions on endorsement.
Who it would affect.
- Taxpayers whose capital or taxable income exceeds the proposed thresholds.
- Authorized Public Accountants who prepare and endorse income tax returns.
- Natural and legal persons covered by the cited provision of Law 280 of 2021.
Key points.
- Proposes to align Article 712 of the Tax Code of the Republic of Panama with Article 2, paragraph 9, of Law 280 of December 2021.Art. 1
- Requires preparation and endorsement by an Authorized Public Accountant when a taxpayer’s capital exceeds eleven thousand balboas and one cent (B/.ll,OOO.Ol).Art. 2
- Applies the same requirement when taxable income exceeds eleven thousand balboas and one cent (B/. 11,000.01).Art. 2
- Provides for a fine of twenty-five balboas (B/.25.00) to one thousand balboas (B/. 1,000.00) for false information entered by an Authorized Public Accountant, to be imposed by the General Directorate of Revenue.Art. 2
- Directs the repeal of Articles 85-A and 90-C of Executive Decree 182 of October 2021 after citing the endorsement rule in Article 2, paragraph 9, of Law 280 of 2021.Art. 3
- Repeals provisions that oppose or contradict the proposed law.Art. 4
- Entrusts implementing regulations to the Executive Branch and sets commencement upon publication in the Official Gazette.Arts. 5-6