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While emphasizing on the unprecedented crisis caused by the COVID 19 pandemic and its relative pitfalls on the world economic affairs, the Hon. Minister of Finance of the Republic of Mauritius presented the National Budget 2020/2021 for Mauritius on 4th June 2020, entitled ‘Our New Normal:  The Economy of Life’. At the outset, the latter acknowledged the exceptional economic situation being experienced due to the recent lockdown phase that caused some key operating cum income driven sectors of the Mauritian economy to halt their activities, with a negative multiplier effect on key economic indices such as unemployment, export factor and economic growth, among others. Consequently, a set of measures centered towards ensuring economic resilience and sustainable development have been announced, with specific strategies unveiled.

A brief on the salient points of the speech delivered the Minister are provided below.



Among the priorities of the Government of Mauritius, a number of measures have been announced in view of consolidating of the Mauritius financial services sector, ranging from new line of business activities to a more stringent legislative framework, adapted to the prevailing norms to combat financial malpractices, as enforced by international benchmark setters, inclusive of the Financial Action Task Force (FATF). Details on the key measures announced are provided below: –


Updated Anti-Money laundering framework

With the recent reports issued by FATF and European Commission (EC), highlighting key discrepancies in the current regulatory regime, the Government of Mauritius shall through the relevant competent authorities put emphasis on the following: –

  • Risk-based supervisions in accordance with the recommendations of the FATF;
  • Targeted outreach programmes to promote clear understanding of money laundering and terrorist risks;
  • Increased reporting of suspicious transactions;
  • Targeted financial sanctions in cases of terrorist financing; and
  • Timely access to beneficial ownership information.

In view of ensuring an effective implementation and enforcement of the above actions, a new AML/CFT (Miscellaneous Provisions) Bill will be introduced, along with the establishment of a specialized Financial Offences Court.


Diversification strategy

In view of further developing the competitiveness of the Mauritius jurisdiction as an International Financial Centre, a set of new products shall be introduced, with relative framework to be defined thereafter. Such activities shall comprise of the following: –

  • The Central Bank digital currency;
  • An Insurance Wrapper;
  • Variable Capital Companies;
  • Dedicated Venture Capital Market for start-ups and SMEs on the Stock Exchange on Mauritius;
  • An inaugural Sukuk issuance by the Bank of Mauritius; and
  • Green and Blue Bond framework by the Bank of Mauritius.


Jurisdiction of the regulatory authorities

In line with the objective set for ensuring compliance with the international best practices, our local regulatory authorities shall be assigned new roles and powers as outlined below: –

Bank of Mauritius
  • To introduce new frameworks in respect to services such as digital banking, private banking and wealth management offered by banking institutions and issuance of specific directives or guidelines; and
  • To allow for some flexibility (subject to prescribed conditions) in terms of legal obligations/requirement imposed on its licensees, not limited to the extension of deadline for submitting financial statements and time period for rotation of audit firms for an additional period of 2 years; and
  • To implement a centralized KYC project
Financial Services Commission, Mauritius (FSC)
  • To allow for internal restructuring and planning (specifically in terms of constitution of its Enforcement Committee and alternative to its Chief Executive) in view of ensuring timely and effective supervisory cum enforcement proceedings and actions; and
  • To consider request for exemptions for filing of annual financial statements (subject to such conditions as deemed appropriate by the Commission). Moreover, auditors of licensees of FSC shall have the obligation to report irregularities to FSC.



In order to make the Mauritius jurisdiction more attractive for business and in view of easing the procedures to set up and conduct business by non-citizens, the below measures have been announced: –

  • The minimum investment amount for an investor to obtain the status of Permanent Resident shall be USD 375,000. Similar principle shall be extended to holders of an immovable property under an existing scheme;
  • In order to pool a maximum of foreign expertise and talents, non-citizen holders of Residence Permit, Occupation Permit or Permanent Residence Permit will be allowed to acquire one plot of serviced land not exceeding 2,100 m2 for residential purposes within smart cities (Note: Specific conditions shall apply);
  • The minimum monthly salary criteria to obtain an occupation permit shall henceforth be Rs 30,000;
  • The Economic Development Board (EDB) shall in consultation with the Public Sector agencies be focusing on the re-engineering of the existing licensing process. A Business Obstacles Alert Mechanism shall be set up by EDB to entertain constraints encountered in the process of issuing permits and licenses;
  • For the concept of Work Permit, the following measures have been announced (Note: Implementation of such measures shall however be subject to such guidelines and protocols to be defined by EDB): –
  1. -Work Permit and Residence Permit shall henceforth be combined into a single permit;
  2. -The validity of the Occupation Permit and Residence Permit for retirees shall be extended up to 10 years;
  3. -Minimum investment to obtain an Occupation Permit shall be reduced from USD 100,000 to USD 50,000;
  4. -For the Innovator Occupation Permit, the minimum turnover and required investment shall be removed;
  5. -The spouse of an Occupation Permit holder shall not require a permit to invest or work in Mauritius;
  6. -Occupation Permit shall be allowed to bring their parents to live in Mauritius;
  7. -Applications for Occupation Permits shall be entertained by the Economic Development Board (EDB) only;
  8. -Professional with an Occupation Permit and foreign retirees with a Residence Permit shall be allowed to invest in other ventures without any shareholding restriction;
  9. -Occupation or Work Permit to invest and work in Mauritius shall no longer be required for non-citizens who have a residence permit under the real estate schemes;
  10. -The Permanent Residence Permit shall be extended from 10 to 20 years; and
  11. -Occupation and Residence Permit holders holding the permit for three consecutive years, shall be eligible to apply for a Permanent Residence Permit.



  1. In addition to the above, the Minister also provided for the amendments in a series of legislations, as provided below. Yet, such proposed updates shall be subject to further fine-tuning and shall be harmonized with the relevant laws and legislations.
  • Entities holding a ‘Corporate Finance Advisory’ licence from FSC pursuant to the Securities Act shall henceforth be required to keep and maintain records of debts raised on behalf of issuers;
  • A member of a private pension scheme, licensed under the Private Pensions Scheme Act, shall be allowed to transfer his/her accrued benefits to another private pension scheme while for unclaimed funds, provisions shall be made for same to be transferred to a special fund to be set up by FSC;
  • Specific to acquisition of properties by a non-citizen without prior authorisation sought for the relevant authorities, the Non-Citizens (Property Restriction) Act shall be amended to allow the Prime Minister’s to validate same subject to assurance obtained on the buyer’s credentials and genuineness of the mistake or omission;
  • Amendments in the Pension Act shall provide for new roles, functions and composition of the Public Pensions Advisory Committee; and
  • The Companies Act will be amended to cater for international best practices aiming at: –
  1. Protecting shareholders against Directors’ prejudicial conduct;
  2. Entities listed on the Stock Exchange of Mauritius shall comprise of at least 2 independent and non-executive directors;
  3. Registration of ultimate beneficial owners at time of incorporation shall be mandatory.



The key fiscal measures are as follows:


Levy on Corporates
  • A company or group of companies having gross income exceeding Rs 500 million in an accounting year will be subject to a levy on its annual gross income at the rate of:
  1. 0.3% for insurance companies, financial institutions, service providers and property holding companies; and
  2. 0.1% for other companies.
  • The levy will not be applicable to a company which operates in the tourism sector or which holds a Global Business License.
Solidarity Levy on Telephony Service Providers
  • A profitable company engaged in telephony service will pay 5% of its accounting profit and 1.5% of its turnover as Solidarity Levy and this will be made permanent.
  • A loss making company will pay 1.5% of turnover as Solidarity Levy.
Alternative Minimum Tax
  • A company carrying on life insurance business will pay tax based on the existing system of taxation or under an alternative minimum tax (AMT), whichever is the higher.
  • The AMT will be computed at the rate of 10% of profit attributable to shareholders adjusted for capital gains or losses.
 Income Tax Holiday
  • Income tax holidays of 8 years will be granted to:
  1. Companies engaged in the manufacture of nutraceutical products provided it starts its operation on or after 4 June 2020.
  2. Companies engaged in the manufacture of pharmaceutical products, medical devices or high-tech products provided it has started or starts its operation on or after 8 June 2017.
  3. Top 500 institutions worldwide that set up a branch campus in Mauritius.
  4. Company under the Inland Aquaculture Scheme.

Double deduction

Double tax deduction will be available to:

  • Manufacturing companies on the acquisition of patents and franchises, including costs incurred to comply with international quality standards and norms.
  • Enterprises affected by COVID-19 on their investment in plant and machinery during period 1 March 2020 to 30 June 2020.
  • Pharmaceutical companies on research and development expenditure.

Accelerated depreciation

  • Accelerated depreciation on Green technology equipment extended to include equipment and machinery used for eliminating, reducing or transforming industrial wastes.
  • Capital expenditure on electronic, high precision machinery or equipment and automated equipment will be allowed as a deduction in the year incurred instead of being amortised over more than two years.

Manufacturing companies

  • The investment tax credit of 15% over 3 years will be extended to all manufacturing companies.

Partial Exemption Regime

  • Partial exemption regime on interest income will not be available to:

1.  Non-bank deposit taking institutions
2. Money changers
3. Foreign exchange dealers
4. Insurance companies
5. Leasing companies; and
6. Companies providing factoring, hire purchase facilities or credit sale facilities.




Income exemption threshold

The income exemption threshold will increase as from 1 July 2020.

Category From (Rs) To (Rs) Increase (Rs)
Individual with no dependent 310,000 325,000 15,000
Individual with one dependent 420,000 435,000 15,000
Individual with two dependents 500,000 515,000 15,000
Individual with three dependents 550,000 600,000 50,000
Individual with four or more dependents 600,000 680,000 80,000
Retired / disabled person with no dependent 360,000 375,000 15,000
Retired / disabled person with dependents 470,000 485,000 15,000


Other exemptions and reliefs

  • A taxpayer may claim an annual deduction ranging from Rs 80,000 to Rs 110,000 for bedridden next of kin under his care provided his total number of dependents does not exceed 4.
Solidarity Levy
  • As from income year starting on 1 July 2020, the solidarity levy will apply on chargeable income plus dividends in excess of Rs 3 million of a Mauritian citizen.
  • The rate of the levy will increase from 5% to 25%.
  • The levy will be payable under the Pay As You Earn (PAYE) system.
Contribution Sociale Generalisée (CSG)
  • As from 1 September 2020, there will be a contributory, participative and collective system which will ensure an additional guarantee of a monthly income to retired citizens above the age of 65 as from July 2023.
  • Under the CSG, the contribution will be as follows:

Monthly Salary Employee Employer
< Rs 50,000 1.5% 3%
>Rs 50,000 3% 6%


  • The CSG will also be applicable to self-employed individuals.
  • The National Pension Fund is being abolished and replaced by the new system of Contribution Sociale Generalisée.
Tax Account Number
  • Each citizen will automatically receive a Tax Account Number (TAN).


  • VAT exemptions extended to:
  • Construction materials and specialised equipment used by Medical R&D centres.
  • Equipment used for the inland aquaculture.
Exempt supplies to zero-rated supplies
  • Goods previously exempt now zero rated:
  • Unprocessed agricultural and horticultural produce.
  • Live animals used for human consumption except live poultry.
  • Transport of passengers by public service vehicles excluding contract buses for the transport of tourists and contract cars.
  • Medical, hospital and dental services.
  • VAT will be applicable on digital and electronic services provide through internet by non –residents for consumption in Mauritius.
  • VAT will be paid to MRA at the date of receipt instead of at the date of invoice for Government construction contracts.


Income Tax
  • The time limit to effect income tax refunds will be standardised to 60 days for all taxpayers and will run as from the date all necessary documentation pertaining to the application is received by the MRA.
  • The MRA will develop further its e-services platform to improve efficiency and transparency in service delivery to taxpayers.
Value Added Tax
  • To allow persons at the lower rung whose constructions span over a long period to benefit from VAT refund in respect of a residential building, provision will be made to allow a claim of less than Rs 25,000 to be entertained where the amount of VAT paid during a quarter and the preceding three quarters do not exceed Rs 25,000.
  •  A VAT e-invoicing system will be introduced at business level, on a pilot basis, to enhance tax compliance.
  • Where a transaction is not at arm’s length, the market value of the supply should be taken as the taxable value.
  •  The MRA will be empowered to request a VAT registered persons, having both exempt and taxable supplies, to apply an alternative basis of apportionment for input tax.
  •  The MRA will have to be informed of the appointment of an administrator, executor, receiver or liquidator to manage or wind up the business of a taxable person.
Mauritius Revenue Act
  • Where an aggrieved party fails to attend or to be represented upon being convened before the Assessment Review Committee, their cases will be struck out except in cases of illness or any other reasonable cause.

The information in the news alert was prepared by the professional staff of DTOS Ltd. The information given is not exhaustive and readers are advised to consult with professionals such as independent accountants, legal counsel and investment bankers before taking any formal action. DTOS Ltd will be pleased to discuss specific problems. Whilst all reasonable care has been taken in the preparation of this newsletter, DTOS Ltd accepts no responsibility for any errors it may contain, whether caused by negligence or otherwise, or for any loss, however caused, sustained by any person that relies on it.

Date of Publication: 8th of June 2020

Contributed by: DTOS Regulatory & Compliance Department


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