New Tourism Laws in Nicaragua: General Law of Tourism and Law on incentives for Tourism Development

August 15, 2024

Arias Law -  With the purpose of fostering, promoting and regulating the development of the Nicaraguan tourism sector, the National Assembly of Nicaragua approved Law number 1210 "General Law of Tourism" and Law number 1211 "Law of Incentives for Tourism Developments", which were published on August 2, 2024, in the Official Gazette Number 141.

The new General Law of Tourism aims to encourage, promote and regulate tourism activity in the country, guaranteeing its sustainable development and ensuring the participation of individuals, families, communities and public and private sectors.

On the other hand, the Law of Incentives for Tourist Developments aims to contribute to the creation of infrastructure for the attraction of tourism by granting, on a one-time basis, to natural or legal persons that carry out tourist development projects that comply with a minimum investment of three hundred thousand dollars of the United States of America (US$ 300,000. 00) or its equivalent in local currency and for small and medium companies of at least fifty thousand dollars of the United States of America (US$ 50,000.00) or its equivalent in local currency that have the approval of the Tourism Incentives Committee, the following tax benefits:

(1) Exemption from Income Tax (IR) on economic activities, for a term of up to ten years, counted from the beginning of mercantile operations.

(2) Exemption from Value Added Tax (VAT) on local purchases of goods and related services, including professional services, and from Value Added Tax (VAT), Import Tariff Duty (DAI) and Selective Consumption Tax (ISC) on imports of construction materials, furniture and equipment, fixed accessories of the building and other equipment, during the investment stage, from the beginning until the completion of the new infrastructure works; both for local purchases and imports.

(3) Exoneration of the Real Estate Tax (IBI) for a term of up to ten years.

These new laws on tourism in Nicaragua provide great opportunities for the economic development of the country, promoting sustainable tourism development, involving local communities and protecting the environment. In addition, it offers attractive tax incentives for investors, creating jobs and supporting entrepreneurship.

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