Business Owners Foot Pensionado Discount Bill in Panama

If you thought that the government of Panama refunds business owners for the discounts to foreigners living in Panama with pensionado status, think again. It is actually the business owners that are giving the discount with no reimbursement from the Panamanian government, which is rather unfortunate and affects the income of the individual business owners. Pensionado status is given to retirees who immigrate to Panama and open up businesses or buy Panama real estate. It is a government program to encourage investment and pensioners to consider Panama as their future home. Read further this story from Business Panama.com.

"Panamanians and foreigners who have pensionado status in Panama are entitled to numerous discounts on everything from entertainment to medications. This visa option has lured thousands of retirees to Panama from countries around the world. This program is great for those taking advantage of the discounts, but it’s not such an ideal situation for those giving the discounts.

Under Panamanian law those in possession of a pensionado visa are eligible for a 50% discount on movies and sporting events, 30% off transportation and 25% off restaurant meals. This includes Panamanians and foreigners alike, and businesses are obligated by law to honor these discounts.

Many Panamanians are trying to survive on a meagre pension, and in comparison, foreigners have much larger disposable incomes. The main downside to these discounts is that it’s the business owners – not the government – that are responsible for taking the loss from those discounts.

If you receive 25% off your meal, the government does not compensate the restaurant owner. The 25% comes out of their profits. For many restaurateurs this can have a pretty big impact on their bottom line. Since this is a government incentive, it would only make sense that the government is responsible for covering the difference. Unfortunately, that is not the case.

Is it fair for the small business owner to have to cover the cost of these discounts, or should the government reimburse them? Since the government is not helping to offset this expense, should foreigners be able to take advantage of these discounts or should they be available only to Panamanians? What is your opinion?"

Source: Business Panama