Paraguay vs Nicaragua
Tax Rate Comparison
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Enter your income to see your estimated annual tax liability in each country — side by side.
Individual Income Tax (Top Marginal Rate)
VAT / GST / Sales Tax
Corporate Tax Rate
Capital Gains Tax
Social Security & Payroll
🇵🇾 Paraguay — Municipal & Departmental Taxes
Paraguay's 17 departments and 254 municipalities levy the Impuesto Inmobiliario (property tax at 1% of assessed value), commercial licence fees (patente comercial), and vehicle registration fees. Asunción has the highest commercial licence fees. The Subsecretaría de Estado de Tributación (SET) administers national taxes. Paraguay has one of Latin America's lowest tax burdens (~12% of GDP) and has used flat low rates to attract foreign residents (MADES visa) and financial activity. No wealth tax exists.
🇳🇮 Nicaragua — Municipal Taxes
Nicaragua's 153 municipalities levy the Impuesto de Matrícula (2% of prior revenues), Impuesto Municipal sobre Ingresos (IMI at 1% of monthly revenues), property tax (IBI at 1%), and service fees. Nicaragua under Ortega government has faced significant economic disruption from 2018 protests and subsequent international isolation. The economy has stabilized somewhat but remains one of the poorest in Central America. Tax administration reform has been ongoing with support from international institutions.
Paraguay vs Nicaragua: Key Tax Differences (2026)
💰 Income Tax: 🇳🇮 Nicaragua has a higher top income tax rate (8–10% vs 0–30%). 🇵🇾 Paraguay is more favourable for high earners.
🛒 VAT/Sales Tax: Nicaragua has a higher consumption tax (10% vs 15%).
🏢 Corporate Tax: 🇵🇾 Paraguay offers a lower corporate rate (10% vs 30%), which can influence business location decisions.
📈 Capital Gains: 🇵🇾 Paraguay taxes investment gains at a lower rate (10% vs 15%), benefiting investors.