1. What is Panama Government Salary Calculation?

The Panama government salary calculator estimates net pay for government employees by deducting income tax and social security contributions from gross salary. Panama uses a progressive tax system with different brackets.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• Gross Pay — Annual salary before deductions
• Income Tax — Progressive tax based on Panama tax brackets
• Social Security — 9.75% of gross pay

3. Panama Tax Brackets

Current Income Tax Rates:

• 0% on first PAB 11,000
• 15% on amount between PAB 11,001 - 50,000
• 25% on amount above PAB 50,000

Social Security: 9.75% of gross salary (employee contribution)

4. Using the Calculator

Instructions: Enter your annual gross salary in Panamanian Balboas (PAB). The calculator will automatically compute income tax, social security contributions, and net pay.

5. Frequently Asked Questions (FAQ)

Q1: Are there additional deductions for government employees?
A: Some positions may have additional pension contributions or union fees not included in this calculation.

Q2: Is social security capped at a maximum amount?
A: Yes, social security contributions are capped at a maximum taxable salary, which changes annually.

Q3: Are bonuses included in gross pay?
A: Yes, all taxable compensation should be included in the gross pay amount.

Q4: How often are tax brackets adjusted?
A: Tax brackets are typically adjusted every few years to account for inflation.

Q5: Are there tax exemptions for certain employees?
A: Some special categories of government employees may have different tax treatments.