Panama Retiree Benefits Update: Project 226 Was Vetoed. What Pensionado Applicants Should Know

Updated October 18, 2026: Project 226 did not become law.

Panama's National Assembly approved Project 226 in third debate on August 27, with 47 votes in favor and one against. The proposal would have expanded benefits under Law 6 of 1987, the law behind Panama's discounts for retirees, pensioners and older residents.

President Jose Raul Mulino vetoed Project 226 in full on September 20 and returned it to the National Assembly, citing both inconvenience and constitutional objections. Panama Presidency, September 20

The policy debate did not end with the veto. On October 6, the National Assembly said a new initiative was again under discussion after talks with retiree groups and the private sector. The Assembly described proposed areas including medicines, medical care, mobility aids, basic services, funeral services and internet. National Assembly, October 6

No replacement law has taken effect as of October 18. The current Law 6 schedule remains the operative framework, and the Pensionado immigration requirements have not changed.

The Pensionado residency program has not changed

Panama's Jubilado Pensionado category grants permanent residence directly. The requirement is a lifetime pension of at least US$1,000 a month, paid by a foreign government, an international organization or a private company, and certified as being for life and currently in payment.

Each dependant needs an additional US$250 a month in solvency, which can be evidenced by a further pension or by a local bank reference.

Spouses may combine both pensions to reach the US$1,000 minimum, and the minimum stays at US$1,000 when they do. A couple combining pensions does not need US$1,250 because there are two of them.

There is also a property exception that is frequently misstated online. Where the applicant personally owns Panamanian property worth more than US$100,000, the pension minimum drops to US$750.

The permit is granted indefinitely and needs no renewal.

None of the current negotiations over retiree discounts changes these Pensionado immigration requirements.

What Project 226 proposed

The medicine proposal was one of the clearest examples. Law 6 currently provides a 20% pharmacy discount on medicines. Project 226 would have raised that to 30%.

Internet would also have been added as a new benefit category. Current Law 6 covers the fixed charge on one residential landline but excludes internet, cellular and cable services.

The home-mortgage provision would have moved from a one-percentage-point reduction in the interest rate on a qualifying mortgage for the beneficiary's own home to two percentage points.

Project 226 also proposed additional benefits involving adult diapers, wheelchairs, walkers and other products used disproportionately by older people.

None of those proposed increases can be demanded today.

Until Panama enacts and publishes a replacement law, the current Law 6 schedule remains in force.

Why businesses pushed back

The dispute is not really about whether retirees should receive more.

Businesses focused heavily on how the discounts would be financed. Project 226 would have allowed benefits granted under the expanded law to be claimed as a fiscal credit against income tax. Under the current system, the fiscal-credit mechanism applies much more narrowly, including the restaurant and fast-food discounts.

For a business, however, giving a discount today and recovering its value later through the tax system are two different cash events. Pharmacies, hotels and other operators still have payroll, rent, inventory and suppliers to pay in the meantime.

Those financing concerns were central to the negotiations that preceded the veto.

The September 15 discussions included electricity, public transportation, telephone service, healthcare, adult diapers, wheelchairs and walkers. Participants also questioned whether some tourism and hotel benefits do as much for lower-income older adults as relief on everyday expenses.

The discussions continued after the veto. By October 6, the National Assembly was describing a new initiative focused more directly on everyday needs, including medicines, medical care, mobility aids, basic services, funeral services and internet. That proposal still has to complete the legislative process before any new benefit can be treated as law.

You do not need the Pensionado visa to qualify by age

Most people assume these discounts belong to the Pensionado visa. They do not.

Law 6 covers Panamanians and foreign residents from age 55 for a woman and 60 for a man, and separately covers anyone who is retired or drawing a pension, at any age. Two different doors into the same schedule.

That matters if you came to Panama another way. Someone who took Friendly Nations, Qualified Investor or the self-solvency route reaches 55 or 60 and qualifies on age alone, with no pension to prove and nothing to certify beyond the cedula.

The documentation ACODECO publishes for foreigners, legalized and translated, applies to someone claiming as a pensioner on a foreign pension. It does not attach to the age claim.

And the current schedule is worth knowing.

A qualifying beneficiary receives 25% off domestic and international air tickets, including online bookings.

Hotels are 50% off Monday to Thursday and 30% Friday to Sunday. At all-inclusive properties, the discounts are instead 20% Monday to Thursday and 12% Friday to Sunday.

Medicines at pharmacies are discounted 20%, with no prescription required for the discount itself. Doctors' fees receive 20%, while private hospitals and clinics are discounted 15% on the total bill.

Restaurants give 25% off the beneficiary's own individual consumption. That means what the qualifying person personally ate and drank, not 25% off the entire table because one person qualifies.

Cinema, theater and sporting events are discounted 50%. Residential electricity receives a 25% discount up to 600 kWh, and passports receive a 50% discount.

These are benefits available under the current schedule, not Project 226 proposals.

There are two limits worth knowing.

Permanent residence is the cleaner position. Some provisional residencies attract questions, so on a two-year provisional route do not count on the discounts while you are still in the provisional stage.

Eligibility is also personal. A younger spouse with no pension of her own does not receive the discounts because her spouse qualifies. She becomes eligible through her own status when she reaches 55.

Permanent residence could become more explicit

Project 226 would have made permanent residence explicit for foreign beneficiaries.

Because Project 226 was vetoed in full, that wording did not become law. Any permanent-residence language in the new initiative has to be checked against the final enacted text rather than assumed from the vetoed bill.

Pensionado applicants are in a different position because Jubilado Pensionado grants permanent residence directly.

The same may be true for clients who obtained permanent residence through another route and later qualify for Law 6 through age.

The permanent-residence question should be checked again if and when a replacement law is enacted and published.

Why this reaches beyond Pensionado clients

For someone coming to Plan B Expat with qualifying lifetime pension income, the residency analysis has not changed. We look at the pension, dependants, documentation and the immigration requirements that are in force now.

But this legislation reaches a much wider group of foreign residents.

Someone who became resident through Friendly Nations, Qualified Investor, self-solvency or another route may never have thought of themselves as a pensionado. Once that person reaches the Law 6 age threshold, the same statutory discount schedule can become relevant.

For people planning retirement expenses, those percentages are not trivia. Medicine, medical care, electricity, restaurants, airfare and travel add up over a year.

The existing benefits are already real. Project 226 would have made some of them larger, but it was vetoed. A new proposal is now being discussed. Until a new text is enacted, those facts should stay separate.

Should a new Pensionado applicant wait?

Nothing about the September 20 veto changes the current Pensionado immigration requirements or requires a qualified applicant to postpone an application.

October 31 is not a Pensionado residency deadline. It is the legislative target that has been discussed for a replacement retiree-benefits law.

For a prospective Pensionado applicant, the residency question can be answered under the rules in force now.

The final shape of any new retiree-benefits law cannot be treated as settled until the legislation is enacted and published.

Considering Panama's Pensionado residency?

Plan B Expat can assess whether your pension and family structure fit the current Pensionado requirements, identify the documents required for your application and coordinate the process before you travel.

[Get Started]