South America
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Import and Export to Paraguay
Despite the challenges, Paraguay offers a wealth of opportunity, particularly in its growing tech sector. With an attractive tax regime, a young, dynamic workforce, and a stable macroeconomic environment, Paraguay is poised for further economic growth. The government’s push to develop the country’s technology landscape presents significant export potential, especially for tech and IT equipment.
Tax
Up to 9%
Duties
Up to 20%
Lead Times
3-4 Weeks
Restricted Items
N/A
Best Carrier Option
Courier or Freight Forwarder
Non-Working Days
Saturday, Sunday, and Public Holidays
Prominent Languages
Paraguayan Guarani; Spanish
The Paraguayan Import and Export Landscape
Paraguay, a landlocked country in South America, is increasingly becoming an attractive destination for international trade, especially in its growing tech and IT sectors. Whether you’re looking to export products to Paraguay or navigate the country’s complex import compliance and tax regulations, understanding the key aspects of the Paraguayan trade landscape is essential.
Population
6.98 M
Biggest Industry by Export
Electricity
Capital City
Asunción
Biggest Industry by Import
Fuels
Paraguay’s economy is built on agriculture, energy, and increasingly, technology. The government is actively encouraging foreign investment, and the local tech scene is seeing promising developments. Paraguay’s young, tech-savvy workforce and government-driven initiatives are creating a fertile ground for startups, especially in tech innovation. If you are looking to export to Paraguay, there is significant potential in the country’s IT and tech sectors.
However, as a landlocked country with a unique set of regulations, Paraguay presents a few specific challenges when it comes to trade. For instance, the Mercosur common market (of which Paraguay is a founding member, alongside Argentina, Brazil, and Uruguay) affects import and export tariffs. Additionally, imports to Paraguay are subject to complex customs requirements and tax compliance rules.
Trade Pain Points When Importing and Exporting to Paraguay
While Paraguay offers incentives for foreign investors, including the lowest tax burden in the region, the country still faces some challenges in terms of its import landscape. The most notable of these challenges include:
Bureaucratic Red Tape
Paraguay’s import process involves navigating through complex government regulations. With specific documentation requirements, and additional compliance obligations for goods originating from certain countries, you need the right expertise to avoid delays and mistakes.
High Tariffs on Imports
Due to the Mercosur Common External Tariff (CET), imports are subject to tariffs ranging from zero to 35%, depending on the goods. However, the CET is often imposed twice if goods are re-exported through other Mercosur countries. This tariff system can significantly increase costs for businesses that are not familiar with the process.
Corruption and Regulatory Hurdles
Starting and running a business in Paraguay can be challenging due to complex local regulations, corruption issues, and an inefficient administrative process.
Additional Tax Obligations
Paraguay is known for its tax incentives, but these benefits are not always straightforward. For example, if you’re unfamiliar with Paraguay’s specific tax compliance requirements, it can lead to unanticipated delays or extra costs, especially when it comes to indirect taxes, customs duties, or the temporary entry system.
Countries that Trade with Paraguay
South America
Argentina
South America
Chile
Tax Compliance in Paraguay | Understanding the Climate
Paraguay has been making strides to improve its tax system, which is relatively simple compared to other Latin American countries. However, staying compliant with Paraguayan tax laws can still be tricky for international businesses.
Low Tax Rates: Paraguay offers one of the lowest tax rates in the region, with its corporate income tax rate set at just 10%. Additionally, indirect taxes like VAT are set at a rate of 10%. However, for international businesses, these rates can be offset by other import-related duties, which makes it important to fully understand the customs duties and local tax implications.
Mercosur Taxation: As a member of Mercosur, Paraguay adheres to the regional common external tariff system, which applies taxes to certain imported goods. This can affect the final cost of products entering Paraguay, especially when goods are imported through other Mercosur countries.
Compliance Risk: Because of the complex regulatory environment, ensuring compliance with tax obligations in Paraguay is a challenge. However, TecEx ’s specialized tax compliance services can help you navigate this landscape and ensure you meet all local tax requirements while minimizing your tax burden.
How We Can Help You Export to Paraguay
Paraguay offers significant opportunities for international businesses, especially in the growing tech sector, but navigating its import regulations can be challenging.
With our Importer of Record (IOR) service, we handle the customs and compliance responsibilities on your behalf, ensuring that your goods meet Paraguay’s strict import regulations. This helps minimize delays and the risk of fines or penalties, so you can focus on your business without worry.
Our Direct Delivery Duty Paid (DDP) shipping solutions take care of all the costs and risks associated with customs clearance, taxes, and tariffs. We manage the paperwork, taxes, and fees, making sure your products arrive quickly and cost-effectively.
We also expertly handle Paraguay’s documentation requirements, including consular certifications and letters of credit. We ensure all necessary documents are submitted accurately and on time, including certifications from the Ministry of Foreign Affairs, so you can stay compliant without delays.
Lastly, we help you take advantage of Paraguay’s temporary importation system, which allows certain goods, like machinery and equipment, to enter the country duty-free for up to 12 months as long as they are re-exported. We take care of the necessary documentation and insurance, ensuring a smooth and hassle-free process.
Ready to Import or Export to Paraguay?
You can overcome Paraguay’s bureaucratic hurdles, minimize compliance risks, and ensure a smooth import process. Get in touch with us to tailor a solution to your specific needs and navigate Paraguay’s import and export regulations with confidence.