Georgia vs Paraguay taxes (2026): territorial tax and company profits

Georgia vs Paraguay tax rates at a glance

Tax	🇬🇪 Georgia	🇵🇾 Paraguay
Income tax	Salary tax: 20% Business income tax: 20% Rental income tax: 20% Foreign-source income for residents: 0% Nonresident Georgian-source salary: 20%	Personal service income: 10% Capital income and gains: 8% Capital gains tax: 8% Foreign-source income: 0% generally Employee social security: 9% / 11% Employer social security: 16.5% / 17%
Corporate tax	Standard corporate tax: 15% Retained earnings: 0% Banks, credit unions, microfinance organisations and loan providers: 20% Dividend distribution: 15%	Corporate income tax: 10% Foreign-source income: 0% generally Dividend distribution tax: 8% / 15% VAT: 10%
Capital gains tax	Individual capital gains tax: 20% Reduced rate: 5% Corporate gains: 15% Crypto gains: No separate CGT	Capital gains tax: 8% Corporate capital gains: 10% Share gains: 8% Property gains: 8%
Dividend tax	Dividend withholding tax: 5% Dividends to Georgian companies: 0% Foreign dividends to resident individuals: 0%	Dividend withholding tax: 8% / 15% Domestic dividend tax: 8% / 15% Foreign dividend tax: Case by case
Wealth tax	Net wealth tax: 0% Property tax on individuals: 0.05% - 1.0% Land tax: Separate	Net wealth tax: 0% Net worth tax: 0% Annual asset tax: 0%
Inheritance / estate tax	Inheritance tax: 0% Estate tax: 0% Gift tax: Depends Probate tax: 0%	Inheritance tax: 0% Estate tax: 0% Gift tax: 0% Probate tax: 0%
VAT / GST / sales tax	VAT: 18%	VAT: 10%
Standard VAT	18%	10%
Personal tax model	Flat 20%	Territorial, generally up to 10%

Who wins on each tax

Personal income taxParaguay

Paraguay's 8% to 10% rates are below Georgia's flat 20% personal income tax.

Corporate taxTie

Paraguay's 10% rate is lower, but Georgia can defer tax on retained company profits until distribution.

Capital gains taxParaguay

Paraguay's common 8% personal gain treatment is below Georgia's 20% headline, though asset-specific rules matter.

VATParaguay

Paraguay VAT is 10%, compared with Georgia's 18%.

Retained profitsGeorgia

Georgia is stronger when profits are kept and reinvested inside the company.

The verdict

Paraguay wins on simple headline rates. Its territorial system taxes Paraguayan-source income, personal rates generally top out at 10%, corporate tax is 10% and VAT is 10%. That is hard for Georgia to beat on ordinary local income.

Georgia still has a strong company angle. Its Estonian-style corporate tax system generally taxes distributions rather than retained profits, which can work well for founders who reinvest earnings instead of extracting them.

Choose Paraguay for territorial planning and low ordinary rates in Latin America. Choose Georgia for retained-profit company planning, regional access and a simpler Eurasian base.

How to read this comparison

Paraguay is usually the cheaper ordinary-rate jurisdiction. Georgia becomes interesting when the business keeps profits inside the company and reinvests them.

Which one fits you

🇬🇪 Choose Georgia if you're a…

Founders reinvesting profits
Businesses needing a Georgia or regional base
Residents who value simple flat tax administration

🇵🇾 Choose Paraguay if you're a…

People seeking territorial taxation
Local operators comparing low ordinary rates
Latin America-focused residents and businesses

Frequently asked questions

Is Georgia or Paraguay better for tax?

Paraguay is usually better for low ordinary personal tax, VAT and territorial planning. Georgia can be better where retained company profits are the main planning point.

Does Paraguay tax foreign income?

Paraguay generally uses a territorial approach, so Paraguayan-source income is the core tax base. Source classification still matters.

Does Georgia tax retained company profits?

Georgia generally follows an Estonian-style corporate model where tax is focused on distributed profits rather than retained profits.