Panama vs Germany
Tax Rate Comparison
Enter your income below for a personal tax estimate, then scroll down for full rate breakdowns.
๐ฐ Personal Income Tax Calculator
Enter your income to see your estimated annual tax liability in each country โ side by side.
๐ต๐ฆ Panama โ Municipal & Corregimiento Taxes
Panama's 10 provinces and 81 districts have municipalities that levy commercial licence fees (Tasa Unica), property tax (impuesto de inmuebles at 0%โ2.1%), and service fees. Panama City has the highest commercial licence fees. Panama uses a territorial tax system โ income earned outside Panama is not taxed. This has made Panama a significant financial and trading hub. The Colรณn Free Zone is the world's second largest free trade zone. Panama is working to exit FATF grey lists and improve tax transparency.
๐ฉ๐ช Germany โ Trade Tax (Gewerbesteuer) & Church Tax
Germany's 16 Bundeslรคnder apply federal income tax rates uniformly โ no state income tax variation. Municipalities levy Gewerbesteuer (trade tax) on business profits at ~7โ17% effective. Church tax (Kirchensteuer) of 8โ9% of income tax applies to registered members. The solidarity surcharge (Soli) now only applies to the top ~10% of earners.
Panama vs Germany: Key Tax Differences (2026)
๐ฐ Income Tax: ๐ฉ๐ช Germany has a higher top income tax rate (0โ25% vs 14โ45%). ๐ต๐ฆ Panama is more favourable for high earners.
๐ VAT/Sales Tax: Germany has a higher consumption tax (7% vs 7โ19%).
๐ข Corporate Tax: ๐ต๐ฆ Panama offers a lower corporate rate (25% vs 29%), which can influence business location decisions.
๐ Capital Gains: ๐ต๐ฆ Panama taxes investment gains at a lower rate (10% vs 25%), benefiting investors.