Paraguay vs Mexico
Tax Residency Comparison
Paraguay taxes foreign income at 0% through its territorial system, while Mexico taxes residents at up to 35%. Mexicans switching to Paraguay residency save $25,000 - $110,000+ per year on average, with a fast 90-day process and only a $5,000 bank deposit required.
Side-by-Side Tax Comparison
| Category | 🇵🇾 Paraguay | 🇲🇽 Mexico |
|---|---|---|
| Foreign Income Tax | 0% | up to 35% |
| Capital Gains Tax | 8% | 10-35% |
| Corporate Tax | 10% | 30% |
| Residency Timeline | 90 days | N/A |
| Investment Required | $5,000 bank deposit | N/A |
| Physical Presence | Once every 3 years | 183+ days/year |
| Path to Citizenship | 3 years to citizenship | Varies |
Why Mexicans Choose Paraguay
Save $25,000 - $110,000+/Year
The average mexicans moving to Paraguay saves $25,000 - $110,000+ annually by eliminating up to 35% taxes on foreign-sourced income.
Territorial Tax System
Unlike Mexico's worldwide taxation, Paraguay only taxes income generated within its borders. Foreign income is generally exempt.
Location Freedom
While Mexico requires 183+ days presence, Paraguay only requires a visit once every 3 years to maintain residency.
Fast Process
Get permanent residency in just 90 days. No years of waiting, no complex point systems, no quotas.
The Mexico Tax Problem
Complex SAT requirements
High compliance burden
Security concerns in some areas
Currency volatility
Important: Leaving Mexico
Mexico has strict residency rules. Paraguay offers simpler permanent residency with territorial taxation.
Our team includes specialists familiar with Mexico tax law who can help you navigate the transition properly and legally.
Who Should Consider Paraguay Over Mexico?
Remote Workers
Keep 100% of your foreign-earned income instead of losing up to 35% to taxes.
Entrepreneurs
Build your business without the Mexico tax burden holding you back.
Investors
Optimize capital gains with Paraguay's favorable 8% rate vs 10-35%.
Retirees
Stretch your pension and investments further with minimal tax obligations.
Frequently Asked Questions
Is Paraguay better than Mexico for taxes?
For foreign income, Paraguay charges 0% versus Mexico's 35% top rate. Paraguay also has simpler compliance than Mexico's SAT system, a 10% corporate rate versus Mexico's 30%, and no mandatory social security contributions.
What's the tax difference between Paraguay and Mexico?
Mexico taxes income at up to 35%, corporate profits at 30%, and has complex SAT reporting requirements. Paraguay taxes only local income at 10%, has a 10% corporate rate, zero tax on foreign income, and much simpler compliance.
Can Mexicans get Paraguay residency easily?
Yes. Mexican citizens enter Paraguay visa-free and can apply directly for permanent residency. The shared Spanish language and Latin American culture make Paraguay an especially comfortable destination for Mexicans.
Explore More Resources
Everything you need to make an informed decision about Paraguay residency
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Last reviewed: February 2026