Panama Needs to Increase Revenues – Reduce Subsidies and Exemptions

Panama is one of the countries in Latin America and the Caribbean with the lowest percentage of tax collection compared to the size of its economy.  The Minister of Economy and Finance, Felipe Chapman, has said that he has several hypotheses about the reduction in income that he is trying to corroborate in his office, because it has decreased despite the fact that the economy has grown.  But in the meantime, they must deal with the containment of spending.  At the end of July, the General Directorate of Revenue reported a deficit of $111 million in monthly current tax revenues, compared to what had been budgeted.  In seven months, revenues are 14% below the estimate.  It is understandable why the Panama government is turning to China for trade.