In recent years, Panama has reduced the number of trade barriers, making the exportation of used vehicles from the United States to the country cheaper and easier than ever before. Many are wondering what’s involved in the process of importing used or salvage vehicles from the United States into Panama.
Below, we’re going to outline the entire process from beginning to end. Starting with an exploration of the best way to purchase used cars in the United States, we’ll review your options when it comes to shipping, and even how to clear both U.S. and Panamanian customs. All told, you’ll learn absolutely everything you need to know about how to import used U.S. vehicles into Panama.
Panamanian Restrictions on the Import of Used Vehicles
Thanks to the recent liberalization of import rules in Panama, there are currently no restrictions placed upon the import of used vehicles from the United States and elsewhere. However, one should note that import duties and taxes are subject to the value of the vehicle, which is itself at the sole discretion of Panamanian customs. We’ll be covering this in more detail below.
Purchasing Used Vehicles at U.S. Online Car Auctions
When you’re looking to get an incredible deal on a used car in the United States, your best option is online car auctions. Websites that provide this service allow you to enjoy the kinds of savings on used and salvaged cars that had previously only been available to dealers. You can save up to 80% on the cost of used and salvaged cars that you might be interested in.
To get started with an online car auction website, you first need to create an account and make a deposit into that account. This deposit will establish your potential maximum bid with the website. Most often, the standard is that the size of your deposit will equate to 10% of what your potential maximum bid can be, e.g. a $600 deposit would lead to a $6,000 maximum bid.
Once you’re set-up, the rest is incredibly simple. From the comfort of your own home or office, you can browse an extensive database of used car auctions taking place across the entire country. In addition, you’ll also be given access to an experienced auction agent or broker, who will be able to help you with everything from setting a bidding strategy to finding used car auctions that are not displayable online.
All told, if you’re looking to find the right used car (or used cars) at a price that simply cannot be beaten, then online car auctions make perfect sense!
Shipping a Used or Salvage U.S. Car to Panama
When you’re looking to arrange shipping from a port in the United States to Panama, you should have little if any difficulty. Many ports offer service to the nation, given that it serves as a vital hub for international trade. Given that, the most important decision you’ll need to make is your shipping method.
Before instantly defaulting to container shipping, you should give some thought to something that’s known as RORO shipping. RORO is a shipping method used to load a vehicle onto and off the ship. It is rolled on at your port of departure and then rolled off once it arrives in Panama. Because there’s relatively minimal labor involved in doing this, RORO shipping presents a unique benefit that you should be aware of: It’s incredibly cheap!
There are, of course, a few drawbacks. Because a container will not shield your used vehicle from the elements, the potential does exist for damage to occur. Additionally, since ship workers will be responsible for physically moving your vehicle, human error could lead to damage as well. That said, the chances of any of this happening are incredibly minor, and often the savings significantly outweigh the risk.
There are several container ports in Panama to which you can ship your used U.S. vehicle. These ports include:
To find out more about any of these individual ports, just click the name above to visit the port’s official website. In addition to these, there are also several smaller ports along Panama’s coastlines that can offer service for used vehicles that are arriving via the RORO shipping method. To find out more, contact your shipping provider for details.
Clearing Your Used Vehicle Shipped to Panama Through U.S. Customs
When importing a used vehicle from the United States into Panama, you will first need to clear U.S. customs. Thankfully, this is an incredibly easy thing to do!
First, you will need to gather the relevant documentation. This will include your used vehicle’s Original Certificate of Title along with one of the following:
- Two (2) Complete Copies of the Original Certificate of Title
- One (1) Certified Copy of the Original Certificate of Title
Submit the documents above with your vehicle to the customs office at your chosen port of departure at least 72 hours in advance of your ship date. To find out where this office is, simply contact the Port Director at the U.S. port you’ve selected.
Once U.S. customs has taken possession of your vehicle and documentation, they will inspect it to ensure that the vehicle is clear of any contraband. In addition, they will also cross-reference the VINs present on the vehicle with the documentation that you have provided, ensuring that they are a match.
Provided everything checks out, the vehicle will then be cleared by U.S. customs and then sent on its way to Panama. Should you have any additional concerns about this process, or if your vehicle is subject to any special circumstances, simply direct your inquiries to U.S. Customs and Border Protection here.
Getting Your Used or Salvage Car Through Panamanian Customs
Once your vehicle has arrived at the port in Panama, upload the vehicle and deliver it to the Panamanian customs office in that port. The customs office assesses the vehicle’s value. The assessment is the first step in clearing the vehicle. It will be calculated for import duties and taxes to be paid.
In addition to paying import duties and taxes, submit the following documentation to secure the clearance of your vehicle:
- Your Passport
- Original Bill of Landing
- Your Original Certificate of Title
- Original U.S. Vehicle Registration
- Proof of Payment for Duties and Taxes (Once Payable)
There is one important thing you should know about clearing an imported U.S. used vehicle through customs in Panama. Panamanian customs is notoriously slow when it comes to arriving at their assessed value for used cars. As such, it can take more time than you might expect to clear a vehicle through customs. Therefore, make sure you plan, especially if you will need the vehicle for your personal use once it arrives in the country.
If you have any additional questions or concerns about the process for clearing your imported used vehicle through Panamanian customs, please consult the official website for Autoridad Nacional de Aduanas (the National Authority of Customs) here.
Import Duties and Taxes for U.S. Vehicles Imported into Panama
As mentioned above, Panamanian customs determine the import tariff for both new and used vehicles based on the vehicle’s assessed value. Do note, however, that this value is left to the sole discretion of customs authorities. In addition, please note that import duties and taxes are assessed on the CIF of the imported vehicle. CIF stands for “Cost, Insurance, Freight” and reflects the total of the car’s value (as assessed by customs), plus the cost of shipping and shipping insurance.
To determine the import tariff you will have to pay on a vehicle imported from the United States into Panama, consult the following:
- 15% of CIF: For vehicles valued at less than USD 8,000
- 18% of CIF: Vehicles valued at between $8,000 and $20,000
- 23% of CIF: Vehicles valued at between $20,000 and $25,000
- 25% of CIF: Vehicles valued at greater than $25,000
- 10% of CIF: All trucks regardless of value
- 12% of CIF: Commercial non-cargo vehicles regardless of value
If you’re looking for the best possible break on import duties for used vehicles in Panama, then you’ll want to look into electric and hybrid vehicles. Until 2012, these vehicles had been exempted from import duties, but now they enjoy a favorable 5% rate based upon CIF.
Apply a standardized fee to all used vehicles imported into Panama. These are assessed as follows:
- $750: Vehicles between one and two years old:
- $1,000: Vehicles older than two years
- $1,500: And vehicles older than three years
Finally, Panama also assesses a Valued Added Tax (VAT) on all imported vehicles regardless of age. Currently, the VAT is 7% of the CIF value of the imported used U.S. vehicle.
Should you have any additional questions about duties and taxes assessed on used U.S. vehicles imported into Panama, please consult the official website for Autoridad Nacional de Aduanas (the National Authority of Customs) for Panama. (Note: website is offered in Spanish.) You may also consult the Embassy of Panama in the United States here.
How to Register an Imported Used Car in Panama
To register your vehicle in Panama, you will first need to have that vehicle inspected. Inspections are overseen by the Autoridad del Tránsito y Transporte Terrestre (ATTT) and are administered by local garages that are licensed by this authority. You can consult ATTT’s website for a list of licensed garages.
When your vehicle is presented, different things will be tested. They will ensure that your lights and signals are in working condition, and they will also check to ensure the proper functioning of your used vehicle’s braking system. The garage to which you presented the vehicle can make the necessary repairs if any problem arises. Or you can take it elsewhere. If everything checks out, you will be presented with a stamped form attesting that your vehicle meets Panamas’ vehicle and safety requirements.
You will then need to take this form to the municipal office (Municipio) where the vehicle will be housed. With the form, you will also need to present the following:
- Proof of Insurance
- Certificate of Title (Must be Clear)
- Receipt of Payment for Import Duties and Taxes
- “Paz y Salvo” Showing no Unpaid Fines or Tickets
- Original U.S. Vehicle Registration
Along with the above documentation, you will also need to pay your registration fee, which will vary from municipality to municipality. If you need to get a hold of the “Paz y Salvo” for your vehicle, please visit this website. Once the Municipio has verified your documentation and collected its fee, you will be issued a registration certificate along with plates for your imported used U.S. vehicle.
Popular Used and New Vehicles in Panama
Asian makes and models dominated the Panamanian auto market for both new and used vehicles. The reason for this is simple. These vehicles tend to be cheaper and are incredibly fuel-efficient. In addition, they’re also incredibly easy to repair in the country. The majority of mechanics in the country have received training for dealing with these vehicles specifically. If you’re importing a used vehicle into the country for your use, then this is something that you’ll want to keep in mind.
Keep this in mind when you import used and salvaged vehicles into Panama as a business opportunity
The road conditions in the country are not ideal, and collisions are common.
As a result, there is always a fertile market for automotive parts to supply Panama’s mechanics and garages. For the savvy importer-exporter, this opens up the possibility of making use of salvage vehicles.
Especially if the value of vehicles allows one to make use of Panama’s lowest rates for import duties and taxes.
Hyundai is the most popular automotive maker with Panamanian auto buyers. Followed closely behind by Toyota and Kia. The most popular makes are the Toyota Hilux and the Kia Rio. They have been jockeying for a position atop the charts for the past several years.
If you’re looking for options for low-cost used vehicles to import, you may wish to look into the Toyota Yaris. Yaris enjoys incredible popularity due to its fuel efficiency and durability. Likewise, the Hyundai Accent GL enjoys incredible popularity for much the same reason.