While certain Latin American countries do levy substantial taxes, there are lawful and strategic avenues to significantly reduce tax liability, sometimes to nearly zero. In fact, certain Latin American jurisdictions have income tax regimes that rival even those of low-tax hubs like Dubai. However, mechanisms like the Foreign Earned Income Exclusion and the Foreign Tax Credit can mitigate double taxation. The government offers a 10-year tax holiday on foreign income, allowing many expats to legally avoid paying any income tax for an entire decade. Even local income is taxed at just 7%, making Guatemala one of the most tax-efficient countries in Central America.