1998 SOUTHERN AFRICA ECONOMIC ... - National Treasury

M au r i t i u s
Mauritian Investment in the SADC Re g i o n
The Mauritian government has signed an agreement with the
government of Mozambique, securing an exclusive 100,000
h e c t a re economic zone near Beira for development by
Mauritian inve s t o r s .Mauritius is also assisting Mozambique in
the rehabilitation of its sugar industry, which may lead to
Mauritian taking over and developing some of Mozambique’s
existing sugar industry.
I N V E S T M E N T C L I M A T E
INVESTMENT INCENTIVES
Mauritius has a number of incentive schemes to attract
i nve s t o r s ,the most notable of which are the EPZ, the Fre e p o rt
and the Offshore sector.
F re e p o rt :C reated in 1992 to promote the country as a re g i o n a l
w a re h o u s i n g ,distribution and marketing centre. M o re than 500
f re e p o rt licences have been granted to operators so far.
F re e p o rt zones are situated in and around Po rt Louis, and are
deemed not to be part of Mauritius.Security around these are a s
is tight, to prevent the evasion of import duty.
O f f s h o re : Two diffe rent types of companies can be created in
the offshore sector, n a m e ly offshore companies and
international companies. O f f s h o re companies are locally
incorporated or are re g i s t e red in Mauritius as a branch of a
fo reign company. International companies, on the other hand,
a re flexible, t a x - e xempt entities, but because they are not tax
resident in Mauritius, t h ey are not able to benefit fro m
M a u r i t i u s ’s extensive double taxation agreement netwo r k .
E x p o rt Processing Zone: An EPZ was created in 1970 to
s t i mulate export-oriented pro d u c t i o n .T h e re is no fo r m a l ly
designated “ z o n e ”,
although most EPZ industries are
concentrated in government industrial estates. C u rre n t ly, t h e
Mauritian government is attempting to attract more high-value
p roduction to the EPZs, and to achieve a greater dive r s i f i c a t i o n
of industry in order to spread risk and accommodate higher
s a l a ry demands, as the country has ap p roached a full
e m p l oyment leve l . Some new industries targeted by the
government are the manu f a c t u re of watches, j ewe l l e ry,
e l e c t ronic measuring instruments, leather go o d s , t oy s , o p t i c a l
go o d s , printing and publishing, i n fo r m a t i c s , high pre c i s i o n
p l a s t i c s ,e l e c t ro n i c s ,light engineering and pharmaceuticals.
Ty p e A p p l i c a b i l i t y B e n e f i t s
E x p o rt Processing Zone
Available to those invo l ved in the pro d u c t i o n • No corporate tax
of manu f a c t u red go o d s ,deep sea fishing, • D i v i d e n d s :Ta x - f ree for 20 ye a r s .
printing and publishing, IT activities or agro - • No customs duty or sales tax on raw
i n d u s t r i e s ,all for export .The Export m a t e r i a l s ,m a c h i n e ry, equipment and
Enterprise Certificate is generally granted s p a re part s ,except for motor ve h i c l e s .
to those who intend to export all their • F ree repatriation of profits and dividends
o u t p u t ,although permission can be obtained and capital without the payment of a capital
to sell a small percentage locally (10%-20% t r a n s fer tax.
of exports) A p p roval for an EPZ cert i f i c a t e • Finance available at pre fe rential rates
u s u a l ly takes from all commercial banks f rom all commercial banks.
one - two months
Strategic Local Enterprise Local industry manufacturing for the • Corporate tax rate: 15% for life.
local market and engaged in an activity like ly • No tax on dividends
to promote the economic, i n d u s t r i a l
and technological development of Mauritius.
Modernisation and Expansion Two broad catego r i e s :
E n t e r p r i s e
1 .I nvestment in production machinery and
e q u i p m e n t ,such as automation equipment
and pro c e s s e s ,and computer applications to
industrial design, m a nu f a c t u re and
m a i n t e n a n c e.
2 .I nvestment in antipollution and
e nv i ronment protection technology to be
made within two years of date of issue of
c e rt i f i c a t e.
• No customs duty on scheduled
p roduction equipment.
• Income tax credit of 10% (spread ove r
t h ree years) of investment in new plant and
m a c h i n e ry.
• Enterprises in Catego ry 2 benefit from a
f u rther incentive, i . e. an initial allowance of
80% for expenditure incurred on
antipollution machinery or plant (against
50% in most other cases).
Industrial Building Enterprise Construction for renting of industrial • Corporate tax rate: 15% for life.
buildings or levels there o f ,p rovided floor • No tax on dividends
space is at least 1,000m 2 . • Registration dues for land purc h a s e :50%
e xe m p t i o n .
• Rent control is not ap p l i c a b l e.
Small and Medium Enterprise Applies to enterprise whose pro d u c t i o n • No customs duty on production
equipment does not exceed Rs5 m
equipment 15% corporate tax
( U S D 275 , 000 ).
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