Guatemala's lagging tax incentives and OECD Pillar 2

Yes, on paper. On sectoral breadth: after Decree 19-2016, the 29-89 regime covers only textiles and apparel and ICT, while Costa Rica, the Dominican Republic, El Salvador, Honduras and Nicaragua exempt almost any exporting manufacturer or service provider — a medical-device maker gets no tax holiday in Guatemala outside a free zone. On years and renewability: the Guatemalan free zone gives 10 years with no extension, against 15 plus extension (El Salvador), 15-20 plus extension (Dominican Republic) and 15/10 indefinitely renewable (Nicaragua since April 2026). The counterweight is the global minimum tax (OECD Pillar 2, 15%), in force since 2024 in the EU (Directive 2022/2523) and other jurisdictions (exact count unverified), which erodes the value of exemptions for groups with consolidated revenue above €750 million. For large capital the race of exemptions loses its point; for the mid-sized investor, the Dominican Republic, El Salvador and Nicaragua still offer more fiscal paper. Guatemala answers with costs, not paper: income tax of 25%, cheap industrial electricity in the EEGSA area and a wholesale market open to users above 100 kW.

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