Why Paraguay Is Becoming LATAM’s Newest Tax Haven for Global Entrepreneurs

By easyco Updated October 10, 2026

Paraguay is often called a “tax haven”, but it is not one in the offshore sense. It is a low-tax, transparent country with real banks, investment-grade ratings and MERCOSUR access. For entrepreneurs who want a real operating company with a simple tax system, it is one of the most attractive options in Latin America.

The tax system in 2026

Tax	Rate
Corporate income tax (IRE)	10% of net profit
VAT (IVA)	10% general; 5% on some goods
Personal income tax (IRP)	8% to 10%
Dividend tax (IDU)	8% for residents; 15% for non-residents

The rates come from Law 6380/2019 and are administered by the DNIT, the national tax authority. Income tax applies mainly to Paraguayan-source income, so a Paraguayan company is generally not taxed on profits earned abroad. Check how this applies to your structure, and to your own country’s rules, before relying on it.

Why it attracts entrepreneurs

Simple, low rates and no tax on wealth.
US dollar-friendly banking: companies can hold accounts in dollars and guaraníes, and there are no exchange controls.
Investment grade from Moody’s (2024) and S&P (2025).
Easy company structure: the EAS allows one shareholder, 100% foreign ownership and no minimum capital.
MERCOSUR access from a base between Brazil, Argentina and Bolivia.

Common uses

Regional trading and distribution companies
Service and software companies billing clients abroad
Holding companies for Latin American operations
E-commerce and logistics operations

What it takes to run a company

Choose the company type. Most founders use the EAS; see the types of companies in Paraguay.
Appoint a legal representative. In practice, banks and the tax authority expect a person who holds a Paraguayan cédula.
Get the RUC from the DNIT and file monthly VAT returns, even with no activity, plus the annual income tax return.
Keep accounting books and renew municipal licenses.

Shareholders are registered by name, and companies must report their beneficial owners. Paraguay is a place for transparent structures, not secrecy. See how to set up a company in Paraguay.

Get help from Easyco

Easyco coordinates the company setup in Paraguay up to the issue of the RUC, and supports companies afterwards with tax, accounting, payroll and company compliance, including a registered office address. Contact us to discuss your project.