Here’s a key summary of the main tax incentives El Salvador offers for newly established or prospective companies, boosting growth and investment in El Salvador.
Free Trade Zones in El Salvador:
- Total exemption from taxes, customs duties, and import charges on machinery intended for the development of the Free Trade Zone.
- Exemption from income tax for fifteen years in the metropolitan area and twenty years outside of it, with the possibility of obtaining an additional period.
Tourism in El Salvador: The main objective of these incentives is to boost tourism development, improve and diversify its offering, and create new jobs to improve the population’s quality of life. Benefits include:
- Exemption from paying income tax for a period of ten years.
- Exemption from real estate transfer tax.
- Exemption from tariff duties on the import of goods and materials for construction.
International Services in El Salvador:
Incentivized activities include: International call centers, International Logistics Operations, Research and Development, among others:
- Free internment for the period of their operations.
- Income tax exemption.
- Exemption of municipal taxes on the assets of the company in El Salvador.
Renewable Energy in El Salvador:
- Exemption of municipal taxes on the assets of the company in El Salvador.
- Exemption from paying Income Tax for five years.
- Complete exemption from all types of taxes on income derived directly from the sale of Certified Emission Reductions (CERs) under the Clean Development Mechanism or similar carbon markets.
- Extension on capital gains for being legal tender.
Promoting innovation and technological manufacturing in El Salvador
- Exemption from Income Tax, all types of withholding, municipal taxes, capital gains, and Import Duties.
We don’t want to miss this opportunity to offer two additional benefits to the tax incentives in El Salvador:
- The inclusion of Bitcoin as legal tender in El Salvador brings decentralization and speed to monetary transactions, becoming a financially inclusive entity for disadvantaged groups.
- Electronic invoicing in El Salvador contributes to cost savings, offers greater control over costs, process automation, and improved productivity.
