Investing in Mauritius is more attractive than many other places because of a very light tax regime. There are many tax benefits in Mauritius:
The symbol "RES" is the abbreviation for Real Estate Development Scheme, which is a provision introduced by the Mauritian government so as to allow foreign nationals to purchase real estate in Mauritius. The Government of Mauritius approved this scheme in 2007 under the regulation Investment Promotion (Real Estate Development Scheme) Regulations 2007. An amendment was passed in 2009 to harmonize the amount of the registration fee on the different schemes.
The dynamism of Mauritius is due to the entrepreneurial energy of its citizens as well as the provision of capital and the know-how of foreign residents. This cosmopolitan mix allows the country to know a booming and a stronghold on the marketplace worldwide. This dynamic is facilitated by a low tax.
For another year, Mauritius is again positioned among the 10 most interesting destinations in the world in regards to the tax level. Taxation is one of the essential aspects of the attractiveness of a country, and Mauritius is a prime example. Fiscal policy of this country is very attractive, with low costs and very little tax, which attracts investors and foreigners. Historically, Mauritius has always been a favourable environment that attracts local entrepreneurs as well as foreigners wishing to establish or expand their business.
Can we, therefore, speak of tax haven, or even of ideal country for tax exemption and offshore companies? No, says Jean-Jacques Lecat associate attorney and president of the Legal & Tax Committee CIAN. This is due to the transparency and cooperation shown by the Mauritian authorities that reassure international control systems.
Mauritius does have some specific characteristics of tax havens, yet the control of the Mauritian authorities on these foreign companies prevent it from falling into the list of countries that are officially recognized as a tax haven. Thus, to obtain a license on the ground, Mauritian companies must prove their contribution to the economy of Mauritius.
Several other conditions are essential enabling to develop a business on the Mauritian territory :
As from January 1st 2015, the government will specify certain criteria such as :
A strict legislation avoiding any abuse or excess, and contributes to the reputation of Mauritius.
The 1 Global Business Licence (GBL 1) can be created with the approval of the FSC (Financial Services Commission) so as to perform offshore activities. The GBL1 can become a resident of Mauritius and benefit agreements to avoid double taxation in the country. The GBL1 is taxed at 15%, except for capital gains, and is not subject to withholding.
A GBL1 consists of at least two individuals or legal entities and must have two resident directors. Its headquarters must also be installed in the country.
The Global Business Licence 2 (GBL2) must also receive a license (issued by the FSC), and unlike the GBL1, it cannot be regarded as resident in Mauritius. Therefore, it does not benefit from double taxation agreements and must be registered with a registration agent. The GBL2 can perform any kind of activity (excluding banking, insurance, trust or investment funds) and absolutely not imposed and not suffers from withholding.
Let's detail the tax system proposed by the Government of Mauritius :
Furthermore, the government has established a system of social solidarity (CSR) that is imposed on each company; 2% is levied on profits earned. The Mauritius Revenue Authority (MRA) is the entity in charge of tax collection in Mauritius. Payments are to be made in 3 ways :
The government of Mauritius imposes all Mauritian resending in the country. Concerning foreign tax, they depend on the number of days spent on the Mauritian soil during the fiscal year. The law states as well as from 183 days in Mauritius on tax year abroad will be automatically placed under the Mauritian tax system. This corresponds to a minimum period of 6 months, whether performed in a single or cumulated over several journeys during the year.
Regarding the specificities of the double taxation, the Mauritian government concluded several international agreements. The advantages negotiated by the Mauritian authorities, which benefit both Mauritian businesses and foreign companies with activities in Mauritius. A non-double taxation that is beneficial to the country's economic dynamism and its worldwide influence. These tax treaties between Mauritius and countries such as France, India or South Africa are additional for investors.
Real schematics are largely beneficial to the country. Sales to foreigners represent 62% of Foreign Direct Investment in Mauritius, which is a considerable amount. The construction of villas and apartments type IRS and RES not only generate direct employment, but mostly indirect employment through the construction sector, furnishing and decoration. Efforts are being made at the architecture level of residences, having a very positive effect on the aesthetics of what is being built in Mauritius.
Mauritius is now considered as an ultra dynamic country with a thriving economy. The country’s tax optimization strategy is effective which turns it into a choice of gateway so as to develop the business and carried it beyond the borders of Mauritius to Africa, Europe or Asia.
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