HONDURAS Law and Practice Contributed by: Alberto Zúniga, Carlos Zúniga and Garhem Padilla, Baker Tilly Honduras
contemplates the possibility of fiscal incentives for companies engaged in research, applied technology and innovation activities in priority sectors for national development. Under this framework, the Honduran Institute of Sci - ence, Technology and Innovation (IHCIETI) may pro - mote financing mechanisms and facilitate access to national and international funding sources. The law refers to the creation of financial instruments, includ - ing favourable credit schemes and support mecha - nisms, rather than automatic income tax exemptions. In practice, the regime operates more as a policy-driv - en promotional framework than as a direct corporate tax relief system. Companies seeking tax efficiency in technology-driven projects typically rely instead on sectoral incentive regimes – such as export pro - cessing, free trade zones or BPO frameworks – where broader income tax and customs exemptions may be available subject to qualification. As a result, technol - ogy investment structuring in Honduras is primarily achieved through sector-based incentives rather than through standalone innovation-specific tax relief. 2.3 Special Incentives Honduras operates a sector-based tax incentive framework under which specific industries and enti - ties may qualify for preferential tax treatment, subject to prior authorisation and ongoing regulatory com - pliance. These regimes are granted through special statutes and require formal registration before the competent authority. The principal productive incentive systems include: • Free Trade Zones (ZOLI) and Export Processing Zones (ZIP), primarily for export-oriented manufac - turing and services; • the Temporary Import Regime (RIT); • BPO and call centre services; • renewable energy projects; • tourism development regimes; and • agro-industrial and export-focused activities. Depending on the regime, benefits may include partial or total exemption from corporate income tax, solidar - ity contribution and net asset tax for a defined period,
as well as suspension or exemption of customs duties and VAT on machinery, equipment and production inputs directly linked to the authorised activity. A significant recent development concerns the Tem - porary Import Regime (RIT). In February 2026, Decree 2-2026 extended the validity of RIT incentives for an additional five fiscal years. In addition to productive regimes, Honduras also rec - ognises preferential treatment for non-profit entities, including non-governmental organisations (NGOs), foundations and associations engaged in public interest activities. These entities may obtain tax-exempt status with respect to income directly linked to their authorised non-profit purposes, subject to registration and ongoing compliance with reporting obligations. However, income derived from commercial activities not directly related to their institutional objectives may remain taxable. Across all incentive frameworks, access is conditional upon formal qualification and continued compliance. Regulatory scrutiny has intensified in recent years, with greater emphasis on operational substance, traceabil - ity of transactions and alignment with the authorised business scope. Failure to meet these requirements may lead to the suspension or revocation of benefits. Accordingly, while Honduras offers structurally mean - ingful tax incentives across multiple sectors, these regimes are compliance-driven and require careful structuring and sustained regulatory management. 2.4 Loss Relief Honduran tax law does not provide a general loss car - ry-back mechanism. Losses cannot be offset against taxable income of prior fiscal years. Loss carry-forward is regulated under Article 20 of the Income Tax Law, but applies only to specific produc - tive sectors. Only taxpayers engaged in the following activities may request loss carry-forward treatment: • agricultural activities; • agro-industrial activities; • manufacturing; • mining; and • tourism.
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