Country Correspondent: Mukhta Toofanee  

The Finance Act 2021 giving effect to the measures announced in the National Budget was enacted last July. The Finance Act provides fiscal measures not only to give relief and allowances to individuals but also to entities so that the economy could be put back on track following the effect of the COVID-19 pandemic.

Some of the measures introduced for the individual taxpayers worth mentioning are:

• Deduction in respect of donation to charitable institutions

An individual will be allowed to claim a maximum deduction of Rs 30,000 for donation made to charitable institution. However, such claim can be made only in respect of contribution made electronically.

• Contribution to National COVID-19 Vaccination Program Fund

  The Government has set up the National COVID-19 Vaccination Programme Fund to finance the implementation of the National COVID-19 Vaccination Programme. As an incentive to encourage individuals and entities to contribute to the Fund, the amount contributed thereon will be allowed as a deduction from their taxable income.

• Premium Visa

  With the introduction of premium visa which is aimed at encouraging eligible foreigners to come for long stay in Mauritius, that is for a period of at least one year with the possibility of renewal, individuals will be spending more than 183 days in Mauritius and will therefore automatically become a tax resident in Mauritius and subsequently be liable to tax in Mauritius on their worldwide income. However, income of a premium visa holder for work performed remotely from Mauritius will be taxed on a remittance basis.

Additional Tax Measures

To give a boost to investment and production in the local economy, several incentive measures have been introduced for the corporate entities some of which are:

• Large manufacturing companies, whose turnover exceeds 100 million rupees, will be allowed to claim an additional 10 percent deduction of the amount of expenditure incurred on the direct purchase of products manufactured locally by small and medium enterprises (turnover not exceeding 50 million rupees).

• Double deduction from gross income on expenditure incurred by:

(i) a company on the acquisition of specialized software and systems;

(ii) a manufacturing company on market research and product development for the African market;

(iii) a company registered as a health institution under the Private Health Institutions Act for its international accreditation.