Paraguay’s main investment partners are the USA, Brazil, and Spain, with the majority of foreign investments directed towards the food industry. Paraguayan law grants investors tax breaks, allows full repatriation of capital and profits, supports assembly plant operations, and guarantees national treatment for foreign investors. Foreign investment is not subject to screening, and foreign entities are permitted to own property.
Despite reforms to the public sector and strengthened legal protections, the political climate, poor infrastructure, restrictive labour regulations, and the lack of transparency are major obstacles for investors looking at Paraguay. Its Ease of Doing Business ranking dropped 12 places this year, leaving it at 125/190. However, there have been some significant investments made in the country in recent years, and new investments target the automobile, logistics and manufactured goods sectors.
In addition, Paraguay’s tax regime is fiddly and, although rates are relatively low, admin will take you some 378 hours per year for the 20 annual tax payments – one of the highest admin times in the region.
AUXADI can become your ideal investment partner in Paraguay. From our office, located in Paraguay, we offer a One Stop Shop value added Outsourcing services in the areas of Accounting and Reporting, Tax Compliance, Payroll Management and Representation services, among others.