Paraguay vs Georgia: Tax Residency Compared 2026

Territorial taxation: the common ground that hides major differences

Both countries apply a territorial tax system: only locally sourced income is taxable. Foreign-source income (dividends from offshore holdings, fees from non-resident clients, returns on foreign portfolios) escapes taxation in both jurisdictions. But the rates and structures differ. For the Paraguayan framework, see our complete guide to the tax system.

🇵🇾 Paraguay: IRP (Law No. 6380/19)

The IRP applies on a progressive scale to Paraguayan-source income.

IRP rate: 8 to 10% (progressive)
Exemption below USD 12,150 of annual income
Dividends: 8% for residents, 15% for non-residents
No wealth tax, no inheritance tax

🇬🇪 Georgia: Georgian Tax Code

The Small Business regime offers one of the lowest effective rates in the world.

Small Business: 1% (up to ~USD 180,000/year)
Local dividends: 5%
Standard income tax: 20%
Foreign-source income exempt for tax residents

Residency: two opposing trajectories in 2026

🇵🇾 Paraguay: accelerated opening

Paraguay launched the Paraguay Investor Pass on 17 April 2026 in São Paulo. Three direct routes to permanent residency now coexist, with no mandatory prior temporary residency:

Amount	Route
USD 70,000	Standard SUACE route (Law No. 6984/22), over 10 years + 5 formal jobs. Operational since 2022.
USD 200,000	Investor Pass — Real Estate or Stock Exchange, with no obligation to start a company or create jobs. Announced 17 April 2026.
USD 150,000	Investor Pass — Tourism, the lowest threshold of the program. Announced 17 April 2026.

🇬🇪 Georgia: progressive closing

On 26 June 2025, Georgia adopted major amendments to its labour migration law, which entered into force on 1 March 2026. The near-total freedom that had defined the country for years is over.

Measure	Detail
Mandatory permit	Special Labour Activity Permit, processing up to 30 days. Violation penalised by a GEL 2,000 fine. In force since March 2026.
USD 150,000	Real estate investment threshold raised, up from USD 100,000 previously. In force since March 2026.
183 days/year	Tax residency by physical presence. HNWI status requires net worth above GEL 3M (~USD 1.1M) or income exceeding GEL 200,000.

Comparison table (updated April 2026)

Criterion	🇵🇾 Paraguay	🇬🇪 Georgia
Tax system	Territorial (Law No. 6380/19)	Territorial (Georgian Tax Code)
Local income tax rate	8 to 10% (IRP)	1% (Small Business) / 20% (standard)
Foreign-source income	0%	0%
Local dividends	8% residents / 15% non-residents	5%
Tax residency criterion	No day-count threshold (RUC + presence)	183 days/year (or HNWI > USD 1.1M)
Direct permanent residency	Yes, from USD 70,000 (SUACE)	Yes, investment from USD 300,000
Mandatory work permit	No	Yes, since March 2026
Regulatory stability	Stable framework, ongoing opening	Accelerated reforms, active uncertainty
Temporary residency entry threshold	< USD 2,000	USD 150,000 (since March 2026)
Wealth tax	None	None
Inheritance tax	None	None

Which profile suits which destination?

🇵🇾 Paraguay stands out for…

The entrepreneur seeking solid permanent residency, with no minimum daily presence requirement, and an internationally recognised Paraguayan cédula.
Anyone structuring an offshore holding (US LLC, Nevis IBC) and looking for a tax residency consistent with their flows.
The investor wishing to access residency through real estate or the stock exchange without setting up a local company (Investor Pass from USD 150,000).
The long-term profile: Paraguayan permanent residency opens the door to citizenship after 3 years, one of the shortest timelines on the continent, subject to meeting the required conditions.

🇬🇪 Georgia remains relevant for…

The IT developer or qualified tech entrepreneur meeting the IT permit criteria (2 years of experience, income above USD 25,000/year).
Anyone wishing to benefit from the 1% Small Business rate within a European-law framework (Georgia is an EU candidate country).
The HNWI profile with a net worth above USD 1.1 million, who can access tax residency without 183 days of presence.

Which country fits your profile?

Our experts analyse your tax situation and your objectives to guide you toward the jurisdiction most consistent with your international strategy.

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Beyond the numbers: culture, climate, freedom and individual sovereignty

Tax residency is more than an accounting optimisation. It is a life choice. And in a world where geopolitical, economic and digital paradigms are being reshaped at speed, the cultural, climatic and institutional framework of the host country weighs as heavily as the tax rate.

🇵🇾 Paraguay: culture & quality of life

Paraguay belongs to a deep Latin tradition: extended family ties, informal hospitality, a more relaxed relationship with time. Asunción and its surroundings offer a comfortable quality of life at moderate cost, with a rapidly growing community of French-speaking and Hispanic expatriates.

The climate is subtropical: hot and humid in summer (December to March), mild during the southern winter (June to August). For Europeans accustomed to long winters, the Paraguayan winter is often experienced as a gentle transition.

In terms of individual sovereignty, Paraguay displays a liberal philosophy in practice: no worldwide taxation, no automatic reporting of foreign accounts at the levels seen in Europe, and an administration that has not developed a culture of aggressive tax surveillance toward foreign residents.

🇬🇪 Georgia: culture & quality of life

Georgia offers a Caucasian and Orthodox cultural setting, marked by a legendary tradition of hospitality, a renowned cuisine, and architecture blending Persian, Ottoman and Soviet influences. Tbilisi was long one of the most creative cities in the region for digital nomads.

The climate is more temperate than in Paraguay: cold winters in Tbilisi (snowfall is possible), hot and dry summers. The Caucasus mountains offer a spectacular natural environment less than two hours from the capital.

In terms of individual sovereignty, the picture has grown more complicated since 2024. The government's authoritarian drift, the laws on "foreign influence", and the new restrictions on the freedom of foreigners to work signal an institutional tightening that contrasts with the open and libertarian image of pre-2023 Georgia.

Sovereignty in a world being reshaped

Paraguay answers this question with notable consistency. Its Constitution provides robust protection of private property. The country is a signatory to only a small number of bilateral tax treaties, which limits the channels for automatic information exchange. Its recent history, marked by a constitutive distrust of foreign interference, has produced a legal framework that places stability and predictability above international harmonisation.

Georgia, for its part, has been an EU candidate since 2023. If that trajectory succeeds, it will eventually mean a progressive adoption of European tax, regulatory and migration standards. What attracts libertarians and tax optimisers today could disappear within a decade.

For an international entrepreneur thinking in 10-year horizons rather than 18-month ones, the direction each country is taking matters as much as its current situation.

Verdict

The Paraguay vs Georgia debate is settled less on taxation — both countries offer real and well-documented advantages — than on stability, flexibility and regulatory trajectory.

In 2026, Paraguay is opening up: new access routes, paperless processes, permanent residency without a day-count threshold, and an Investor Pass designed for investors who do not wish to operate a business locally (announced by the MIC Paraguay on 17 April 2026). Georgia, meanwhile, is closing in: mandatory work permits, raised thresholds, increased surveillance, and a political uncertainty that weighs on medium-term visibility.

Beyond the numbers, Paraguay also offers a Latin anchorage to those who feel close to that culture, a steady subtropical sun, and an institutional philosophy that respects the sovereignty of the individual in their patrimonial and economic choices. In a world where states tend to reassert control, this is a rare value proposition.

For an international entrepreneur seeking a clean, defensible and durable tax residency — particularly one operating through offshore structures (US LLC, Nevis IBC) — Paraguay in 2026 offers a more stable, more predictable, and now more accessible framework than ever.

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