Bitcoin taxation: an agreement that places Panama among the pioneers in Latin America

Posted on 2025-04-30

Panama City has just closed a key agreement

The city of Panama signed an agreement with a local bank to enable voluntary payment of taxes and services with cryptoassets. The news was shared on X by Mayor Mayer Mizrachi, who had provided some details about the procedure a week earlier.

The partnership, which will allow citizens to pay their tax obligations with BTC, ETH, USDC, and USDT, was signed during Panama Blockchain Week 2025 by the city's mayor and Benjamín Méndez, president of Towerbank. The news was covered by local and international media.

A few days ago, Mizrachi celebrated his city council's initiative, asserting that the city—which he described as the financial mecca of Central America—"was falling behind." The mayor clarified that those wishing to use crypto assets to make their payments will not face major difficulties, as the process will be carried out through a bank that will convert the cryptocurrencies into dollars and then transfer them to the mayor's office. This was reported by CriptoNoticias.

Regarding the signing of the agreement with Towerbank, the official took to his X profile to declare to his followers that "the city has made history" and assured that Panama will continue to be "the financial capital of South America." In previous statements, Mizrachi has expressed support for eliminating redundant processes, thus seeking to keep things running smoothly.

In this way, the Panamanian capital is positioned among the cities in the region that allow its citizens to pay taxes with crypto assets. While some localities in the United States and Europe have already implemented similar measures, Panama joins jurisdictions in Latin America such as Mendoza, Argentina, a province that launched a tax payment system in 2022 that facilitates the use of digital currencies. This progress reflects an improvement in the interaction between this technology and banks, marking a significant shift from historically restrictive stances.

Currently, paying taxes with cryptocurrency is a fairly rare option worldwide, so much so that it is not available in places like New York State. However, some local legislators, such as Clyde Vandel, chair of the state's banking committee, are currently working for a change. Vandel recently proposed a bill to amend state financial legislation to allow citizens to use crypto assets to pay taxes, fines, and rent to New York government agencies.

The agreement between Panama City and Towerbank is signed.

Towerbank has emerged as a key player in connecting the region's traditional banking system with the cryptocurrency ecosystem. Since the pandemic, this Panamanian bank has strengthened its presence in the sector through products such as its crypto-friendly account and the Ikigii platform, both designed to facilitate the integration of crypto assets with dollars.

Facilitating the payment of taxes and services using crypto assets marks a significant step toward a more modern public administration. This initiative will not only benefit cryptocurrency users but will also open opportunities for those who have historically been excluded from the financial system. By offering an alternative to the exclusive use of fiat currency, obstacles such as complicated bureaucratic procedures and lack of access to conventional banking services are eliminated.

This progress is complemented by legislative efforts seeking to provide a clear regulatory framework for the use of digital assets within the country. Gabriel Solís, a substitute representative, recently presented a draft bill to the National Assembly to establish such a framework, highlighting the potential of cryptocurrencies to generate employment and attract foreign investment. Solís emphasized that, contrary to previous beliefs, this technology is no longer something of the future, but a reality that is transforming the present.