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Amidst social measures, this Budget nonetheless displays the Government's drive to pursue business facilitation. The announcement of the Business Regulatory Reform Bill as an apex legislation on business facilitation is recognition that there is scope for legal reform for doing business in Mauritius. The tenor of the bill is yet to be unveiled but here lies an opportunity to simplify the business regulatory regime.
The amendments proposed to the tax appeals process aim to provide for a more expeditious resolution of tax disputes and should comfort taxpayers that finality in tax matters can be achieved sooner rather than later.
From a banking and financial services industry perspective, what comes out is the Government's determination to recognise the virtual assets sector and develop a digital currency. The announcement that the Bank of Mauritius (BoM) may open accounts and accept deposits for the purposes of issuing a digital currency is in line with the recent remarks of the Governor of the BoM on the creation of a central bank digital currency whereas amendments are proposed to various legislations to recognise virtual assets.
We hope that the Government's determination will provide the needed impetus to push the virtual assets sector to the next level though continued engagement of all stakeholders remain key to establishing Mauritius as a leading international hub for virtual assets services.
The Budget also envisages a relaxation of the COVID-19 protective measures implemented for businesses: the duty of directors upon insolvency under the Companies Act is to be reinstated. This suggests a return to normalcy.
The Financial Intelligence and Anti-Money Laundering Act (FIAMLA) will be harmonised with the Financial Action Task Force (FATF) recommendations by including combatting of proliferation financing under its scope.
Definition of property under the Mutual Assistance in Criminal and Related Matters Act will be aligned with the FIAMLA and will include virtual assets.
The BoM will be empowered to open accounts and accept deposits from persons for the purpose of issuing digital currency.
Functionalities of the Central KYC Systems and Central Accounts Registry will be increased to facilitate collection, verification, validation and extraction of KYC records.
The Companies Act will be amended to remove the temporary time extension provided because of COVID-19 to call annual meeting of shareholders and prepare and file financial statements.
Duty of directors to consider the appointment of a liquidator or administrator in case of insolvency will be reinstated.
Companies will be prevented from being registered both in Mauritius and in another jurisdiction at the same time.
The Courts will be empowered to order destruction of goods imported in breach of rights under the Industrial Property Act.
Insurance Act to define “custodian”, “custodian agreement”,”clearing”, “clearing system” and “settlement”.
Setting up of a framework for Structured Investment-Linked Insurance Business activities.
The “fit and proper” requirements in the Insurance Act is to be aligned to those provided under the FSA.
The Non-Citizens (Property Restriction) Act will be amended to mitigate the risk that a non-citizen owns residential premises to which he is not entitled through acquisition of shares in a company.
Proposed extension of the regulatory functions to allow investigations of market abuse cases involving issuers on securities exchanges.
The MRA will be entitled to request information from foundations and trusts to make assessments, collect tax or comply with a request under the Double Taxation Avoidance Agreement.
The MRA will be allowed to publish names of companies which have not filed their income tax returns on its website.
Mauritius to enter into international arrangement for alternative dispute resolution of cross border tax disputes under the Income Tax Act.
Implementation of internationally recognised standards to prevent base erosions and profit shifting.
Minister of Finance will be empowered to make regulations to address tax challenges regarding the digital economy.
The threshold for disputes before the Alternative Tax Dispute Resolution panel will be lowered from Rs10m to Rs5m.
The MRA Act will be amended to improve the efficiency of the Assessment Review Committee.
The MRA Act will be amended to allow the MRA to recover foreign taxes in order to provide assistance to foreign countries.
A deed of registration containing a secure digital signature in conformity with the Electronic Transactions Act will be accepted under the Registration Duty Act
Virtual assets will be covered under the Declaration of Assets Act.
Virtual asset will be defined under the Good Governance and Integrity Reporting Act.
A person will be required to disclose all information necessary for the recovery of a virtual asset when an Unexplained Wealth Order is made by the Judge in Chambers.
The FSC and other investigatory authorities will be allowed to use software/digital tools in investigations. Information obtained through software/digital tools will be admissible in a criminal investigation, prosecution or other related criminal or criminal court proceedings.
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