How Does Mauritius Stand Out From Other Offshore Hubs? – Withholding Tax


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Mauritius is widely known and internationally acclaimed as
the foremost funding gateway into Africa. The nation is the
eastern-most a part of Africa and is a member of the African Union
and different financial blocs. Its prime location within the Indian Ocean,
coupled with a buoyant monetary system and a protected and safe
system of legislation makes it an excellent base for corporations investing in
Africa. As rightly described by the previous CEO of the Financial
Services Commission and now Governor of the Bank of Mauritius, Mr.
Harvesh Seegolam – “Mauritius ticks all of the
packing containers
“.

Our earlier article on Mauritius being the popular platform
for doing enterprise in Africa might be consulted right here.

How does Mauritius stand out from different offshore hubs
such because the UAE and the BVI, amongst others?

Mauritius is rather more than simply an offshore hub.

Firstly, Mauritius is a safe and clear nation with a
vast community of financial ties. It has nurtured shut commerce and
funding ties with varied nations and is extending its ties
throughout the African continent. It is a vital regional participant
by way of its membership of buying and selling and cooperation organizations
just like the Southern African Development Community, the Common Market
for Eastern and Southern Africa (COMESA), the Indian Ocean
Commission, the Indian Ocean Rim Association, African Growth and
Opportunity Act, and an interim financial partnership settlement
(EPA) with the European Union. Furthermore, it has struck a free
commerce settlement (FTA) with Turkey and a preferential commerce
settlement (PTA) with Pakistan.

Secondly, Mauritius has a really beneficiant double taxation reduction
system – international tax credit will not be topic to a limitation
and might be set off in opposition to different taxable international earnings in the identical
12 months. Also, the place international dividends are earned, the Mauritian
recipient can declare credit score not solely in respect of the withholding
tax suffered but additionally on the company tax suffered on the income
out of which the dividends had been paid. This is especially related
for Mauritian corporations holding African subsidiaries, that are
nearly at all times topic to excessive tax. This can usually result in 0% tax
payable in Mauritius. The nation has concluded tax treaties with
45 nations, together with South Africa. An inventory of all nations with
which Mauritius has concluded a Double Taxation Avoidance Agreement
might be consulted on the web site of the Mauritius Revenue Authority
right here.

Moreover, the place capital good points tax ranges from 30-35% in some
African nations, the Double Taxation Agreements in power in
Mauritius restricts taxing rights of capital good points to the nation
of the vendor of the belongings, i.e to Mauritius itself for a Global
Business Company registered within the nation. Since there isn’t any
capital good points tax in Mauritius, the potential tax financial savings for a
Mauritius registered firm are vital.

Thirdly, the Mauritian Economic Development Board (EDB) has
just lately been eager to place Mauritius itself as a producing
hub by providing varied funding incentives for corporations and
export-oriented companies. Some of these incentives embody:

  1. An efficient tax fee of three% on income derived from export of
    items;
  2. No import duties on gear and uncooked supplies;
  3. VAT on uncooked supplies is payable at customs clearance however
    reimbursable on exports;
  4. Industrial electrical energy tariffs for manufacturing
    actions;
  5. An 8-year tax vacation for corporations engages within the
    manufacturing of pharmaceutical merchandise, medical units and
    high-tech merchandise.
  6. Other actions eligible for an 8-year tax vacation in
    Mauritius embody regional headquarters, funding underneath a wise
    metropolis scheme and extra just lately, newly included freeport
    operators or builders.

Also, Mauritius gives international traders a welcoming place for
residency -its nice temperatures, unimaginable tropical
atmosphere, hospitable and bilingual inhabitants, in addition to the
high-end well being and training providers are engaging options of
this vacation spot, providing an excellent setting to take a position, dwell or
retire. After all, the celebrated American writer Mark Twain as soon as
mentioned: “Mauritius was made first, after which heaven; and
heaven was copied after Mauritius
“.

The content material of this text is meant to supply a common
information to the subject material. Specialist recommendation needs to be sought
about your particular circumstances.

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