Country Rankings - Mauritius
Jun 21, 2017 Mauritius: substantialWhen is a tax haven not a tax haven? It depends. The boundaries between "onshore" and "offshore" have been blurred in the last 20 years, and ironically, the OECD must claim much culpability for this. While offshore jurisdictions have been encouraged (to put it somewhat euphemistically) to repeal ring-fenced offshore company and tax regimes, which were used exclusively by non-resident investors to pay less tax, they have in the main retained very low or zero rates of tax. In other words, they may no longer be offshore by name, but they feel offshore by nature. Mauritius, which announced a Budget replete with new tax incentives earlier this month, is a good example. It replaced offshore company forms with the Global Business Company, which allows non-resident business pay tax as low as 3 percent if they structure their affairs in the right way. Mauritius has been used extensively to channel tax-free investment into major emerging economies around the Indian Ocean, particularly India, and last year it was accused by Oxfam of possessing all the characteristics normally ascribed to a tax haven, with the all the negative connotations that implies. Unsurprisingly, it was a claim that the Mauritian authorities strenuously denied. Superficially, perhaps Oxfam had a point. After all, a major reason why investors register businesses in Mauritius is to reduce exposure to tax, but without doing much in the way of business in the jurisdiction itself. Indeed, legislation largely forbids GBC1s to undertake business in Mauritius anyway. But then again, Mauritius is more than just a mere conduit for global cash flows. It has a "real" economy, centered on tourism, sugar production, fishing, food processing, textiles, and, latterly, information technology and communications. The same cannot be said of other IOFCs which, lacking natural and human resources, depend heavily on financial services and tourism. They too bristle at being labelled as tax havens, especially given that most major IOFCs are well up to speed with international tax transparency standards. Still, perhaps it is unfair to lump Mauritius in with all the so-called tax havens. Its latest Budget shows that it is trying hard to attract more businesses with substance. It also shows that it is unfair to tar all "offshore" jurisdictions - whatever you want to call them - with the same brush.
Oct 12, 2015 Mauritius: healthyIt must also be somewhat irritating for the OECD and the EU that offshore financial centers, said to be "major facilitators of BEPS" with their "harmful" tax regimes, refuse to die in spite of its two-decade campaign to wipe them off of the world's financial map. Indeed, many of them seem to be getting stronger. There have been more examples of this in recent days: the Mauritius Financial Services Commission published its 2014 annual report recently, showing healthy growth in the territory's financial services sector; the Financial Times's Banker magazine named the Cayman Islands as the world's top specialized financial center for banking; and the Channel Islands Securities Exchange announced the first listing by a company with its ultimate parent in China. Indeed, the rate at which offshore structures located in jurisdictions such as the British Virgin Islands and the Channel Islands are used to channel investment out of and into China suggests they will remain important cogs in the world's financial machinery for a while longer yet.