Panama has started a bidding war for retirees:
To attract more investment, the central American nation has eased
immigration laws and set up a discount bonanza for expatriate
pensioners that includes 20 percent off professional services such as
those provided by lawyers, architects and physical therapists; no
property tax for 20 years; no income tax on income earned outside
Panama; and a 50 percent discount on real estate closing costs.
that’s only the beginning. The list of discounts goes on and on,
including price breaks on telephone service, surgery and domestic
airfares and a one-time waiver of duties on imported household goods up
All it takes to qualify is pension income of $500 or more per month — at any age and from any source.
Here is the story.
I can think of four relevant models here. 1. The Panamanian government is simply stupid. 2. In Panama most prices are well above marginal cost, making this a good deal for the nation as a whole. 3. The Panamanian government has a preference for sources of wealth which will not get involved in politics. 4. The Panamanian government believes that the greater number of residents will result in a more efficient spreading of fixed costs. I put my money on #2 and #3, and do visit Panama if you have never been; it is far more interesting than the now overtouristed Costa Rica.