The Maquila Law (Law No. 1064/97) is one of the pillars of Paraguay's investment attraction model. It allows foreign companies to carry out transformation, assembly, or manufacturing processes on Paraguayan soil while paying a single tax of 1% on the value added in the country.
What is the Maquila regime?
The Maquila regime allows a foreign company to hire a Paraguayan company to carry out part of its production process. Inputs temporarily enter the country and the finished product is exported.
Main benefits
- Single tax of 1% on local added value. No VAT or income tax on Maquila activity.
- Temporary import of inputs without payment of tariffs or VAT
- Temporary admission of machinery without payment of taxes
- Access to the export market without restrictions
- Legal stability guaranteed by contract with the Paraguayan State
What industries can operate under Maquila?
The regime applies to textile manufacturing, metalworking, software, call centers, electronic assembly, and agro-industry.
The approval process
The National Council of Export Maquila Industries evaluates the project with a feasibility study.
The contract is approved by resolution and signed with the State. Timeline: 60 to 90 days.
Managed before the National Customs Directorate to begin operations.
Paraguay combines the Maquila Law with strategic location in the heart of Mercosur, some of the cheapest electricity in the world, and macroeconomic stability.