Honduras

Companies operating under special tax regimes are generally exempt from Corporate Income Tax (CIT), sales tax, customs duties, and certain municipal taxes. The main special tax regimes available in Honduras include the following:

• Free Trade Zones (FTZs).
• Industrial Processing Zones (Zona Industrial de Procesamiento – ZIP).
• Temporary Import Regime (Régimen de Importación Temporal – RIT).
• Tourism Incentives Law.
• Law for the Promotion of Electric Power Generation from Renewable Resources (Ley de Promoción a la Generación de Energía Eléctrica con Recursos Renovables), which grants tax exemptions for a period of ten years to projects with an installed capacity of 50 MW or more.

FTZ regulations also include specific provisions for international service companies, such as business process outsourcing (BPO), call centers, contact centers, and shared service centers, which are entitled to the same tax exemptions granted under this regime.

Additionally, the Call Center and BPO Promotion Law provides a tax holiday on the importation of tools, parts, accessories, furniture, office equipment, and other goods directly related to the company’s business activities, as well as an income tax exemption on revenues generated from activities carried out within FTZs.

To operate under any of the above-mentioned special regimes, companies must comply with specific governmental requirements and authorization procedures.

Companies benefiting from special tax regimes are permitted to sell part or all of their production in the local market. However, income derived from local sales is subject to the standard corporate tax rules.

Amendments to tariff and customs legislation have introduced general tax exemptions. Decree No. 278-2013 establishes a list of tariff and customs exemption decrees that remain valid and continue to grant tax benefits (for further details, consultation with the local PwC practice is recommended).

Likewise, amendments to income tax legislation provide for general tax exemptions. Decree No. 278-2013 also includes a list of income tax exemption decrees that remain in force and continue to grant tax benefits (contact the local PwC practice for additional guidance).

Where a special tax regime does not specify a particular duration for tax benefits in the corresponding governmental resolution, the term of the tax exemption is limited to 12 years.

The Law for the Promotion and Protection of Investment (Ley para la Promoción y Protección de las Inversiones) was amended to establish a 15-year term for tax stability agreements, except for Public-Private Partnership (PPP) projects. At the same time, the amendment repealed the special income tax discounts previously granted under this law.

Finally, special benefits apply to industries that import semi-manufactured materials for assembly in Honduras and export finished products. These benefits include duty-free imports of raw materials used in the production of export goods, as well as duty-free imports of machinery required for these activities.