Taxation

• Introduction of AMT on companies operating in the following specified sectors:​

1. Hotels;​

2. Insurance companies;​

3. Companies engaged in financial intermediation;​

4. Telecommunication companies.  ​

• Where the total tax payable by a specified company under the Income Tax Act (ITA) after allowable deductions but prior to foreign tax credits is less than 10% of its book profits, the specified company will be required to pay 10% of its book profits instead of its normal tax payable. ​

• Book profit for the purposes of the AMT will be post adjustments for capital gains/ losses and dividends from resident companies.​

• The AMT will not apply to holders of a Global Business Licence (GBL) and companies benefiting from income tax exemptions and tax holidays.​

• No tax credits can be used to offset the AMT.

• 50% of CSR Fund entitled to be spent by companies, instead of 25% currently.

• 80% tax exemption now available to licensed Virtual Asset Service Providers on income derived from the exchange, transfer, safekeeping and administration of virtual assets, subject to satisfying prescribed substance conditions. ​

• 80% tax exemption not available to banks on foreign source dividend.

• An ITC of 5% over 3 years (i.e. 15% in total) will be granted to qualifying small businesses or service providers with an annual turnover not exceeding Rs10m on the acquisition cost of new equipment (excluding motor vehicles) not exceeding Rs500,000 during the period from 01 July 2025 to 30 June 2030.​

• Unrelieved ITC may be carried forward for 5 years.

• Corporate tax exemption granted to the National Guarantee Corporation Ltd. ​

• Corporate tax exemption granted to companies implementing projects whereby at least 50% of the project is financed through grants or concessionary financing from a foreign state or a donor institution.

• 4-year income tax holiday to SMEs on conversion from sole trader or partnership to company no longer allowed where the SME is:​

1. providing professional services;​

2. a tourism operator; or​

3. a training institution.

• The following double deductions will be restricted to SMEs:​

1. emoluments & training costs paid to employees in Rodrigues;​

2. expenditure on the cost of setting up a crèche or Child Day Care Centre;​

3. expenditure on acquisition of patents and franchises;​

4. expenditure on acquisition of specialised software and systems;​

5. expenditure on financing, sponsorship, marketing or distribution costs of a film.​

• 150% deduction of expenditure on filing fees in respect of an application to a recognised arbitration institution in Mauritius restricted to SMEs. ​

• Triple deduction of donation of a maximum of Rs1m to a charitable institution or NGO restricted to SMEs.

• Introduction of a monthly Salary Compensation 2025 payable during the period from January to June 2025 as follows:​

• Introduction of the National Minimum Wage and Salary Compensation 2024 to export-oriented enterprises, irrespective of profitability, as follows:​

• Renewal of the following allowances and phasing out over the next two years to 30 June 2027:​

1. CSG Income Allowance;​

2. CSG Child Allowance;​

3. CSG School Allowance;​

4. Pregnancy Care Allowance; and​

5. Maternity Allowance.​

• Abolition of Independence Allowance effective 01 July 2025.​

Household members who are beneficiaries under the Social Register of Mauritius (SRM) will continue to benefit from the above allowances. The monthly allowances payable will be as follows:

• Cap of 1.5 times of levy paid by a bank in the year of assessment 2017-2018 will be removed.

• Zero-rate VAT extended to:​

1. fruit and vegetable purées for infants;​

2. canned vegetables such as tomatoes and mushroom;​

3. frozen packed vegetables such as potatoes, beans, spinach and mixed vegetables; ​

4. hairdressing services; and​

5. CCTV systems

• Specified digital or electronic services provided by foreign suppliers will be subject to VAT with effect from 01 January 2026.​

• VAT refund on harvesting services will be granted to planters under the VAT Refund Scheme for Small Planters.​

• The VAT Refund Scheme on the construction of a residential building or the purchase of a residential apartment or house from a property developer will end on 30 June 2025.

• Where a project is financed to the extent of at least 50% from grants or concessionary financing, as approved by the Ministry of Finance, from a foreign State or a donor institution, the company implementing the project will be considered as an exempt body.

• Corporates having annual chargeable income above Rs24m will be required to pay a Fair-Share Contribution at the rate of:​

1. 5% of chargeable income if they are subject to the standard tax rate of 15%;​

2. 5% of chargeable income for banks including on income derived by banks from transactions with non-residents and Global Business Companies; and ​

3. 2% of chargeable income if they are subject to the reduced tax rate of 3%.

• Banks will be required to make an additional contribution of 2.5% of their chargeable income from domestic operations (excluding income derived from transactions with non-residents and Global Business Companies).​

• The contribution will not be applicable to:​

  1. companies holding a Global Business Licence;​

  2. companies exempt from payment of income tax or which have been granted tax holidays; and​

  3. income exempted from income tax.​

• Corporates and Banks will not be allowed to offset any unused tax credits such as the foreign tax credit against the contribution payable.​
• The contributions will be payable on a quarterly basis.

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• Penalties and interest will be capped to 100% of the tax amount due.​

• Further, penalties and interest for unpaid taxes will be reduced by 50%, provided they do not pertain to withholding taxes collected on behalf of the Government.

• A one-off TDSS will be introduced to reduce the backlog of tax cases under dispute or litigation at the Assessment Review Committee (ARC), the Supreme Court (SC) or Privy Council (PC).​

• Under TDSS, taxpayers who withdraw their cases from the ARC, the SC, or the PC and have outstanding tax claims will be granted a full waiver of penalties and interest.​

• The Scheme applies to cases under litigation as of 05 June 2025 and runs until 31 March 2026. Taxpayers must pay the tax due by 31 March 2026 to benefit from the Scheme.
  
  
• No tax, penalty, or interest paid  will be refundable under this Scheme, except where the case is before the SC and the tax has already been settled.

• A second one-off scheme, the VDSS, will be introduced to encourage taxpayers who have undeclared or under-declared income or taxable supplies to come forward and regularise their tax affairs.​

• Under VDSS, a taxpayer will benefit from a full waiver of penalties and interests.​

• The VDSS will be available until 31 March 2026, with all payments required by that date.​

• For income tax purposes, the VDSS will cover undeclared or under-declared income for the Year of Assessment 2024/25 and earlier, excluding returns due in June 2025.​

• For VAT purposes, the VDSS will apply to undeclared or under-declared taxable supplies for periods ending on or before 30 April 2025.​

• No tax, penalty, or interest paid  will be refundable under this Scheme under any circumstances.​

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• Extension of TASS providing full waiver of penalties and interests for tax debt and tax arrears outstanding as at 30 June 2025, provided the taxpayer registers by 30 November 2025 and pays the tax in full by 31 March 2026. 

• All tax agents will henceforth be required to register with the MRA. ​

• Members of the Mauritius Institute of Professional Accountants and law practitioners will be deemed registered under the law.

• Businesses earning at least 50% of their annual turnover in foreign currency will be required to settle their tax liabilities in foreign currency.

Arm’s length test​

• The scope and methodology of the application of the arm’s length principle will be reviewed.​

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Tax ruling​

• The fees payable for a Income Tax ruling will be increased to: ​

(A) Rs3,000 for an individual; and (B) Rs50,000 for any other person.

Deferred payment in respect of VAT on capital goods​

• Under the deferred VAT scheme, a VAT-registered person is not required to pay VAT on the import of capital goods of a value of Rs1m or more. However, the VAT-registered person should declare the non-payment in his VAT return. To further ease the cash flow of businesses, the threshold for the import value of capital goods will be reduced to Rs500,000 or more.

Extension of Objection and Appeal Payment Requirements to Customs Legislation and Excise Act​

• The Income Tax Act and VAT Act make provision for any aggrieved person lodging an objection at the Objection Directorate of MRA or an appeal at the Assessment Review Committee (ARC) to make a payment of 10% and 5% respectively of the amount of taxes underpaid. Similar provision will be made in the Customs Act, Customs Tariff Act and Excise Act to discourage frivolous objections and appeals with a view to delaying the payment of taxes due.​

Failure to provide detailed grounds of objection ​

• If a person disputes the tax amount assessed by the MRA but has not specified the detailed grounds of the objection, the MRA may treat the objection as lapsed. However, the individual will retain the right to appeal against the MRA’s decision​
• This new provision will be included in the various customs laws in the following cases: ​

1. payment of taxes under protest by the person; ​
2. non-acceptance by MRA of a claim for refund of duty paid in excess made by the person; ​
3. claim by MRA for an erroneous refund or reduction in taxes; ​
4. claim for underpayment of taxes by MRA; ​
5. claim for taxes due by MRA where a person sells goods on which exemption has been granted before the expiry of 4 years from the date of the exemption; and ​
6. claim for excise duty unpaid following a stocktaking of excisable goods in a factory.​

• During the financial year 2025-26, suppliers making a turnover of more than Rs80m will join the e-invoicing system.​
• Credit for input tax on rented parking is disallowed, except for motor vehicles used in the furtherance of a business.​
• MRA will be empowered to use the best of its judgement when making an assessment of taxes due where it is not satisfied with the adequacy or correctness of records kept.​
• An administrator, executor, receiver or liquidator appointed to manage or wind up a company will be liable to pay the VAT due  in the order of priority of payments to preferential creditors set out by the Insolvency Act.​
• Reverse charge on supply of services received from abroad will apply to all VAT registered persons, including banks receiving services from a foreign supplier.​
• A person seeking a ruling has no right of representation against the ruling at the ARC.​
• VAT will be applicable on supply made to a foreigner who is outside Mauritius at the time the service is performed, if the service is utilised in Mauritius.​
• A holder of a Pleasure Craft Licence issued by the Tourism Authority will be required to compulsorily register for VAT purposes irrespective of his turnover. ​
• The fees payable for a VAT ruling will be increased to: ​
• (A) Rs3,000 for an individual; and (B) Rs15,000 for any other person.​
• A person will be liable, on conviction, to a fine not exceeding Rs100,000 and to imprisonment not exceeding 3 years upon failure to submit information requested by MRA.​
• Failure by a person to give access to computers and other electronic devices requested by MRA will be an offence and the person will, on conviction, be subject to a fine not exceeding Rs200,000 and to imprisonment not exceeding 5 years. ​
• A fine not exceeding Rs500,000 will be applicable for offences relating to: ​

1. making an incorrect return or statement ; ​
2. making an incorrect claim for repayment in respect of capital goods; ​
3. giving incorrect information in respect of tax liability;​
4. a person claiming to be VAT registered when he is not; or ​
5. obstructing an officer of MRA in his functions. ​

• The fine will henceforth be an amount not exceeding Rs1m for: ​

1. failure to register for VAT purposes; ​
2. failure to submit a VAT return and pay any tax due; or ​
3. submission of false returns, books, records, VAT invoices, documents or information with intent to evade VAT. ​

• The fine for the following offences has been increased to Rs100,000: ​

1. failure to keep records, produce books and records or provide any other information required by MRA for the purpose of ascertaining the tax liability of a person; ​
2. failure of a VAT registered person to issue a VAT invoice; ​
3. failure of a VAT registered person to change his taxable period from quarterly to monthly when his annual turnover exceeds Rs 10 million; and ​
4. contravening any other provisions of the VAT Act/Regulations other than (1) a person claiming to be VAT registered or (2) obstructing an officer of MRA in his functions.​

• A penalty not exceeding 50% and interest at the rate of 0.5% per month will be imposed on excise duty considered unpaid following a stocktaking of excisable goods in a factory.​

• When Customs issues a tax claim to a manufacturer following a stocktaking of excisable goods, the manufacturer may only appeal through the MRA’s Objection Directorate.​

• The MRA will have the option to give public notice of the list of excise licences issued, renewed, transferred, cancelled or surrendered at the end of every year through publication in the Government Gazette, a newspaper or in electronic form.