Mauritius has made a strong case for Indian businesses to set up manufacturing or investment companies to get easier access to at least 21 African nations with the same or better tax and fiscal advantages that Mauritius incorporated firms enjoy when investing in India. These are the fallout of the Prime Minister’s visit to India in the event of the Third African India Summit. In a bid to bolster up investment from India, the Prime Minister inaugurated the Board of Investment office in New Delhi.
Mauritius has several DTACs and investor protection agreements with African nations and is part of two regional groupings namely COMESA and SADC. Indian firms can avail of zero capital gains tax while investing in Africa through Mauritius holding companies; in the same way Mauritian companies are not taxed in either of the countries for the capital gains made in India.
Many Indian businesses including the Tata Group had meetings with the Mauritian delegation led by Prime Minister Anerood Jugnauth. Africa is a huge market with rising purchasing power and Mauritius is the bridge to that market for Indian businesses, explained Jugnauth. Moreover, goods and services exported from Mauritius to Africa enjoy duty concessions and face no quantitative restrictions.
The 32-year-old bilateral double tax avoidance convention (DTACs) between Mauritius and India is currently been renegotiated.
Prime Minister Narendra Modibhad assured during his last visit to Mauritius that India would not do anything that may harm its treaty partner’s interests. “We expect that philosophy would continue in our economic relations,” said Jugnauth.
Mauritius participation in OECD’s project aimed at curtailing the aggressive tax avoidance practices of multinational corporations to show its commitment towards transparency, exchange of information and best international practices in the financial services sector.
If Mauritius and India sign a multilateral agreement contemplated by OECD and G20 nations, the India-Mauritius DTAC would be modified, bringing in a limitation of benefits clause in the treaty with the aim of preventing its abuse.
The Financial Express
Board of Investment Mauritius:
Date: 03 November 2015