A new initiative, termed the “Tax Balance Project,” has been approved by the Asunción’s Municipal Council responsible for overseeing the Historic Centre of Paraguay’s captial. The project seeks to stimulate investment in this culturally significant area by implementing substantial reductions in property taxes, aiming to rejuvenate the historic district, and address longstanding urban challenges.
The initiative outlines a strategic approach to align tax conditions in the Historic Centre with those in other parts of the city, such as Villa Morra. Specifically, it advocates for a reduction of up to 52% in property taxes for properties located within the central core area, alongside a 25% reduction for designated heritage properties, recognising their cultural and historical value.
During the Commission’s third session, First Lady Leticia Ocampos emphasised the commitment to revitalizing the vibrant pulse of Asunción’s old town after more than six months of technical collaboration between the Municipality of Asunción, together with the Office of the First Lady. “We dream of a Historic Center that recovers its vibrant pulse and once again becomes a source of pride for all Paraguayans,” she added.
Collaborative development and outdated taxation
Architect Justo Martínez, a key figure behind the initiative, explained that the Tax Balance Project emerged from a collaborative effort involving central government institutions, various municipal departments, and civil society organisations. This partnership underscores a shared commitment to addressing the economic barriers that have hindered development in the Historic Centre.
Martínez highlighted that the current property tax framework, which has not been updated in 20 to 30 years, places older, modernised buildings at a financial disadvantage. Renting such properties is often more costly compared to newer constructions in other city areas, discouraging investment and contributing to urban neglect.
Broader strategy and municipal incentives
The Tax Balance Project forms part of a broader municipal strategy to revitalise Asunción’s Historic Centre. This includes additional incentives for construction, fumigation, and waste collection fees, all of which will be jointly managed by the municipality to ensure cohesive implementation and maximum impact.
To facilitate the project’s progress, the Municipal Council of Asunción approved an ordinance to amend the urban zoning framework before. This change authorises the National Cadastre Directorate to draft the necessary resolution, marking a critical step towards formalising the tax reductions and associated incentives.
Institutional support
The initiative was developed during an inter-institutional meeting chaired by Director Omar Cubas of the Historic Centre Directorate. It has garnered significant support from key stakeholders, including merchant associations such as ADA and ASECHA, who view the project as a vital opportunity to bolster economic activity in the area.
By reducing financial barriers, the initiative aims to attract new investments, fostering the restoration and modernisation of historic properties.The project holds the potential to transform the Historic Centre into a vibrant hub of cultural and economic activity. With the backing of both public and private stakeholders, it represents a promising step towards preserving Asunción’s heritage while promoting sustainable urban development.
