HONDURAS Trends and Developments Contributed by: Alberto Zúniga and Carlos Zúniga, Baker Tilly Honduras
Honduras 2026: Corporate Tax Policy in a Period of Institutional Transition Current corporate tax framework Honduras’ corporate tax policy is not being rein - vented, but is being adjusted within an established incentive-based framework. Despite recent reform debates and administrative transitions, the country continues to rely on sector-specific regimes as core tools of industrial and economic policy. In its first months in office, the current administra - tion has signalled continuity within the existing frame - work rather than structural overhaul. Recent measures include: • a three-month tax amnesty package under Execu - tive Decree No 7-2026; • the extension of the Temporary Import Regime under Executive Decree 2-2026; • the continued operation of Tax Free Zones; and • renewed steps toward re-engagement with inter - national arbitration mechanisms in order to provide stability for investors. These initiatives suggest an effort to stabilise the exist - ing tax structure as the new administration addresses past challenges before attempting to define a longer- term regulatory direction. The proposed Law on Tax Justice ( Ley de Justicia Tributaria ) became a central reference point in Hon - duras’ recent tax policy debate. Although it was ultimately not approved, the proposal significantly shaped the political and fiscal climate surrounding exemptions and special regimes, influencing investor perception of their durability. The continuity of spe - cial regimes has long formed part of Honduras’ policy discussion. The ongoing ICSID arbitration concerning the Próspera ZEDE regime (ICSID Case No ARB/23/2) further underscores how changes to incentive frame - works can generate international dispute exposure. The resolution of that case may influence how future incentive frameworks are approached, particularly in the context of balancing fiscal policy with investment protection. In Honduras, reform volatility is not new; part of the country’s legislative tradition has long been shaped
by political transitions. The present moment, and the tax outlook for 2026, should therefore be understood not as a dramatic break from the past, but as an early stage in which consistency of enforcement and clarity of direction will determine how the market interprets the government’s approach. Reform debate and incentive stability The effort to approve a new Law on Tax Justice marked a period in which exemptions and special regimes were publicly debated at a structural level. Even with - out legislative approval, the proposal brought the durability of incentive frameworks into sharper focus. The debate over tax incentives led investors to evalu - ate not only the substance of potential reform, but also the possibility that long-standing regimes could be reconsidered or restructured. Although the reform did not pass, the debate shifted the tone of the fiscal discussion. Special regimes that had historically been treated as established compo - nents of the tax system became subject to policy review. This shift alone influenced how both domestic and foreign investors assessed regulatory risk. At the administrative level, a new body of legislation was brought forth in 2025 under Agreement No 143- 2025, which establishes a manual of procedures for the control, verification and supervision of tax exon - erations. This new control mechanism introduced a more formalised review structure for companies oper - ating under special regimes. The regulation strength - ens oversight, increases documentation requirements, and clarifies compliance expectations for incentive beneficiaries, with the ability to fine, suspend and even terminate special incentives not managed prop - erly by taxpayers. Enhanced supervision can reinforce fiscal discipline and transparency. However, long-term stability and consistency in a country depends not only on stronger controls but also on uniform application; oversight that varies significantly across sectors or regions may gen - erate uncertainty rather than confidence for investors. A significant example can be studied under the Próspera ZEDE arbitration (ICSID Case No ARB/23/2). A Zone for Economic Development (ZEDE) was
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