Panama real estate company says it will invest $5bn in real estate, but will have to pay more than $1bn in taxes
Panama real-estate company Omora says it has committed $5 billion in real-property investments in a bid to offset taxes and repay the government for what it calls “loans” from the US government.
Omora, which is owned by US hedge fund manager George Soros, said it is “unfazed” by the new tax law, which it says “will make real estate transactions less tax-friendly.”
“I do believe that this will make real-tourism more expensive,” Omorah said in a statement.
“The new tax is expected to raise the price of the properties by around 50 per cent in some cases.”
Omorah is one of the biggest real estate companies in the world.
It owns properties in some of the world’s most expensive cities including Beijing, New York, London, Paris, Dubai and Sydney.
It has invested in projects in Hong Kong, Singapore, Singapore and China.
Its $3.2 billion purchase of the former Bora Bay complex in 2013 cost the US Treasury $1.3 billion in interest and penalties.
The company then used $3 billion of the proceeds to pay off its debt.
In February 2016, the company sold the BoraBay complex for $6.6 billion, the first time any US company had ever sold a complex in the city of 1.4 million people.
Obora said the move to the new law “will not impact the value of the assets in Panama, or any other foreign country.”
The company said it would pay $5.9 billion in taxes in the first two years of the new rules, but said it will need to pay $4.8 billion over five years.
“Taxpayers in Panama will be in a position to pay lower taxes on their profits, and we believe that will make a difference to the economic recovery in Panama,” Obora chief executive officer David Omoray said in the statement.
“Our aim is to ensure that our company can continue to invest in Panama’s real estate market and continue to contribute to the local economy, in particular in the construction of the Panama Canal.”
The Panama Canal Authority said in February it is working on a draft tax law that will apply to the US-controlled canal.
Omora said the new taxes will apply for “all real estate investments, whether in Panama or in any other country,” including commercial projects, infrastructure projects and commercial real estate.
It is also expected to impose an additional tax of 15 per cent on the gross income of individuals holding US nationality.