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Blog · Paraguay

Paraguay: why businesses invest there

Low taxes, access to the Mercosur market and fast company registration make Paraguay an attractive country for investors.

A business-friendly environment

Paraguay is known for its openness to foreign investment, minimal bureaucratic interference and tax legislation that is friendly to entrepreneurs.

  • Low taxes. Some of the lowest tax rates in the world for businesses and individuals: in certain sectors the profit tax can drop to 2.25-5%.
  • Free trade. International agreements open access to global markets.
  • No income tax for exporters. Export-oriented companies pay no income tax.
  • Fast company registration. Setting up a company in Paraguay is quick and transparent.

A second citizenship

Paraguayan citizenship can be obtained within a few years, and faster under certain programs. A Paraguayan passport gives visa-free entry to every Schengen country, the United Kingdom, Ireland, Cyprus and almost all of Latin America; visas for Australia and India can be arranged online under a simplified procedure. Paraguay is welcoming to citizens of Russia and Belarus.

For travel to Mercosur countries, Paraguayans can use their domestic ID card instead of a passport. Dual citizenship is not prohibited, but on its own territory Paraguay, like Russia, treats such a person as its own citizen and disregards other passports.

The economy

Paraguay has had one of the fastest-growing economies in Latin America over the past ten years: the country sticks to a strategy of fiscal responsibility and macroeconomic stability, and exports grow year after year.

Paraguay is a full member and one of the founding countries of Mercosur, which lets industrial goods move freely across the bloc's economic space without import duties.

Thanks to the climate (an average temperature of 28°C and around 1,200 mm of rainfall a year), livestock farming is highly developed. Two large hydroelectric plants on the Parana river, Itaipu and Yacyreta, together with the Acaray plant make electricity in Paraguay some of the cheapest in the region.

Murblz lawyers guide investors in Paraguay from choosing a business project through to receiving a passport.

FAQ

Why are taxes in Paraguay so low?
The country keeps some of the lowest rates in the world for businesses and individuals and deliberately does not complicate the administration. In certain sectors the profit tax can drop to 2.25-5%. The exact rate depends on the type of activity and the regime the company falls under.
Do exporters pay income tax in Paraguay?
Export-oriented companies pay no income tax. That is one of the reasons manufacturing and trading operations are moved into the country. The conditions for applying the regime depend on the type of activity and the structure of the transactions.
How long does it take to register a company in Paraguay?
By regional standards the process is considered quick and transparent. The actual timeline depends on the business form, the bank and how ready the founders' documents are. Timelines and requirements change, so they are checked before you start.
How do I get Paraguayan citizenship?
The standard route is through a residence permit and permanent residence, living in the country for several years. Under certain programs the period can be shorter. Practice and requirements change regularly, so the route is chosen for your specific situation.
Where can I travel with a Paraguayan passport?
The passport gives visa-free access to many countries, including the Schengen area and most of Latin America. The lists are revised, so the current set of destinations is checked before you travel. For some countries electronic authorizations still apply.

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