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Labor Laws in Paraguay

Employment laws in Paraguay are uniquely suited to the country’s way of life, and crucial to understand if you want to employ local talent in this country. Get the details on Paraguay employment laws and Paraguay policies here.

Income Tax in Paraguay

Paraguay has a progressive income tax with rates between 0% to 10%.

Value Added Tax (VAT) in Paraguay

The standard VAT rate is 10%.

Social Security in Paraguay

In Paraguay, social security contributions are mandatory for both employees and employers, and they are directed to the Social Security Institute (IPS):

Employee Contribution

  • 9.0% for commercial entities.
  • 11.0% for financial entities.

Employer Contribution

  • 16.5% for commercial entities.
  • 17.0% for financial entities.

Work Visas in Paraguay

Here are the main work visas available in Paraguay:

Temporary Residence Permit

  • Valid for one year and can be renewed repeatedly for up to six years.
  • For individuals with an employment contract with a business incorporated in Paraguay.
  •  

Permanent Residence Permit:

  • Allows the applicant to live and work in Paraguay indefinitely.
  • Applicants must reside in Paraguay for at least three years before applying.

General Requirements for Work Visas

  • To obtain a work visa or permit in Paraguay, applicants typically need to provide:
    • A valid job offer or employment contract.
    • A clean criminal record.
    • A birth certificate.
    • A valid passport with at least six months remaining before expiry.
    • A police clearance certificate.
    • Relevant professional or educational certificates.

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