New hotel developments are taking off in Panama’s interior regions.
Hotel investments outside of the ever-busy capital, Panama City, are being encouraged through tax incentives for new developments, including a total import tax exemption on goods and services such as building materials, furniture, hotel equipment, as well as construction equipment. Permits for the tax exemption are available until 2020, with the exemption lasting 20 years.
Data for 2014 through May show that 22 permits have been granted, representing investments worth US$7.1 million. Of those permits, nine of the developments are located in Chiriqui, three in Los Santos, two in Herrera, one in Bocas del Torro, one in Cocle, and six in the province of Panama, outside of the capital city.
The progress of hotel developments into the interior seeks to desaturate the tourism industry from Panama City. Of the hotels built in the past six years, 90% of them have been in Panama City, including 25 in 2013. In 2013, Panama City had 17,000 hotel rooms—up from 10,000 in 2010.