Mauritius Budget 2015/2016 snapshot
Presented by the Minister of Finance on 23 March 2015, the 2015/2016 Mauritius budget (the “Budget”) contains a number of interesting measures, including the expansion of the port sector, the promotion of small and medium enterprises (SMEs) to create employment, the creation of a legal framework for the exploration and production of petroleum, incentives for “green” investments and reinforcing partnership opportunities with the African continent.
In addition, the Budget (also dubbed the “No Tax Budget” by the Minister of Finance)provides for a number of tax measures aimed at consolidating tax legislation, making tax administration more taxpayer-friendly and introducing a number of income tax, VAT and other tax exemptions.
Importantly, the Budget also announces a number of targeted measures to revamp our Financial Services sector. These include the following:
- a special Financial Sector Incentive Scheme will be introduced to attract international asset and fund Managers to relocate their front-office in Mauritius;
- The Financial Services Promotion Agency will be reactivated (after having been dissolved previously in October 2006);
- a “Financial Services Institute”, will be set up to provide specialised training courses focussed on the actual needs of the financial industry;
- the Board of Investment will be posting 8 Trade and Investment Managers in strategic cities around the world: Beijing, Geneva, Pretoria, London, Moscow; Mumbai, New York and Paris;
- the role of the Mauritius Africa Fund will be redefined with a particular focus on the development of Special Economic Zones (SEZ) in various African countries such as Madagascar, Ghana and Senegal.
- the Banking Act will be amended to clarify that foreign banks providing loans to global business companies will not require a money lender licence;
- The Bank of Mauritius will provide market makers with an exit mechanism for Government securities;
- the Income Tax Act will be amended to exempt non-resident corporate bond holders from withholding tax.
These measures constitute promising and positive steps towards strengthening the role of Mauritius as a robust and modern International Finance Centre.
A number of measures which were previously announced in the Discours-Programme of the new Government on 27 January 2015 were not addressed in this Budget. This include the introduction of a minimum wage bill, the establishment of a Financial Crime Commission, the extension of statutory maternity leave and the updating of the Criminal Code to tackle financial crimes.