Mauritius Budget Speech 2021 – 2022: Rebooting the Mauritian Economy
The Mauritius Budget 2021-2022 Speech took place Friday 11 June 2021, with the goal in mind of “Rebooting the Mauritian economy”. Minister of Finance, Dr The Honourable Renganaden Padayachy, Economic Planning & Development, presented.
Mauritius has recently become a High-Income Country (July 2020). It reached this milestone despite having one of the worst years in its history, due to the global COVID-19 (coronavirus) pandemic, which has wreaked havoc on its economy.
The 2021/2022 budget focuses on accelerating economic recovery, triggering revival and strengthening resilience. With a mixed developing economy consisting of manufactured exports, agriculture, tourism and financial services, 2021 experienced a negative impact on tourism and exportation. As a result, the country needs to open its borders to investment.
As stated by Dr The Hon. Renganaden Padayachy, “Mauritius has always been a welcome home for professionals and international talents. As a small open economy, faced with a demographic challenge, it is imperative that we further open up our country.”
Should these announcements be passed in August 2021, the impact on the Mauritian economy, and the rebooting thereof, is expected to be exponential.
The Minister based the Mauritius strategy on 3 salient features:
- Recovery – Job preservation and creation
- Revival – Forecasting a GDP Growth of 6% globally and 9% for Mauritius
- Resilience – Unemployment stayed at 9.2% for 2021 with a forecasted projection to reduce to below 4% in 2022.
With delving into the recorded minutes of the Mauritius Budget Speech of 2021 – 2022, we would like to highlight the following:
LIVE, WORK AND RETIRE IN MAURITIUS
- A special desk will be set up to ease the facilitation of foreign retirees looking to make Mauritius home.
- Invest Hotel Scheme will be amended to: allow the sale of up to 80% of units, with the possibility for the owner of a room to stay for a maximum of 6 months annually.
- The minimum selling price of a standalone villa under the Invest Hotel Scheme has been reduced from USD 500,000 to USD 375,000.
- The validity period for an Occupation Permit for Professionals is being extended from 3 years to 10 years in line with the investors, self employed and retired non citizens.
- Non- citizens holding an Occupation Permit as a Professional will be given flexibility to switch job without having to submit a new application provided that minimum criteria are met.
- Non-citizens holding an Occupation Permit as Self Employed will be allowed to incorporate a one man company and employ administrative staff.
- The maximum age limit of 24 years for dependents will be waived.
- A new category under the Occupation Permit Regime was announced; a 10-Year Family Occupation Permit, for those contributing USD 250,000 to the COVID-19 Projects Development Fund.
- A Privilege Club Scheme will be implemented which will provide a range of incentives to Occupation Permit holders and retirees, ranging from privilege access to hotels, golf courses, restaurants, private medical institutions, amongst others.
INVEST IN MAURITIUS / WORK IN MAURITIUS
- 16 incentive schemes will be introduced in an attempt to facilitate ease of doing business.
- Various commissions will be set up to encourage trade, export and investment.
- The new Industrial Financial Institution (IFI) will be set up. IFI will also guarantee financing of SMEs.
- All registered businesses with the Economic Development Board (EDB), will be getting exclusive support. The EDB will implement a platform with the Mauritius Revenue Authority (MRA) and Central Business Registration Database (CBRD) to facilitate exchange of information across regulatory bodies.
- Expected Income Tax increases did not form part of this year’s budget which is welcome news for investors, employers and employees.
- Proposed Corporate Tax reduction in the Biotechnology sector from 15% – 3 % is well received and will hopefully attract investment.
- A commitment to move from coal to sustainable energy resources makes way for solar residential solutions, 5% duty reduction on electric vans for up to 180K watts and investment in public transport opens up great opportunities for investors within this sector in Mauritius.
- Premium Investor Certificate – Minimum investment MUR 500 000 (excluding pharmaceuticals).
STUDY AND WORK IN MAURITIUS
- The criteria for Young Professional Occupation Permit is under review to reduce the list of qualifying services removed, with eligible students automatically qualifying for an extended 10 year Young Professional occupation permit post studies.
- International students enrolled in a recognised educational institution in Mauritius will benefit automatically from a 20 hours per week work permit and a 10 year renewable Young Professional Occupation Permit, upon graduation.
- Digital industry academies will be set up.
TECHNOLOGY ADVANCEMENT IN MAURITIUS
- The METISS cable connecting Mauritius to South Africa has been a reality since March 2021. It will expand the new digital highway to the rest of the world.
- The Emerging Technologies Council, which is being set up, will be a prominent addition to the research landscape, especially in new technologies such as Blockchain, Artificial Intelligence (AI) and Internet of Things (IoT).
- Set up of a FinTech Innovation Lab
HOSPITALITY ANNOUNCEMENTS & MEASURES
- Borders will be reopened from 15th July 2021 to all vaccinated travellers to enjoy a hotel holiday with full use of hotel facilities and beach access for 14 days. After this they will be permitted to explore the island and leave resort facilities.
- Travellers must be fully vaccinated at least three weeks prior to arrival in Mauritius.
- Fully vaccinated travellers will be allowed entry subject to a negative PCR test 72 hours prior to boarding. They must undergo a PCR test between day 5 and day 7 before their arrival on the island and attain a negative Covid result.
- Travellers will be expected to undergo PCR tests on day 7 and day 14 of their stay.
- Full opening of the island will occur from 1st Oct 2021. If travellers are unvaccinated they will be required to stay at an approved quarantine facility for 14 days. They will undergo PCR testing on day 7 and 14 and will be permitted to leave quarantine upon attaining negative results.
- All hotel and tourism staff will be fully vaccinated and social distancing protocols will be in place to ensure the safety of all travellers to Mauritius.
OTHER IMPORTANT KEY TAKE-AWAYS FROM THE MAURITIUS BUDGET SPEECH 2021 – 2022 INCLUDED
- 125m has been earmarked for ministries to finance research projects in priority fields through the Research and Innovation Council aimed at encouraging research and innovation.
- Promoting Mauritius as a Trade Hub, the EDB will launch an e-exports directory, to display all products available for exports and facilitate movement of goods.
- The Green Energy Industry must produce 60% of the country’s energy needs through green energy by 2030. Use of Coal to be phased out before 2030. Development Bank of Mauritius will be providing funding to enable households to purchase solar kits in order to assist the government to achieve its goal by 2030
- Government will introduce a key contactless payment system, to further facilitate ease of doing business.
- A secularisation bill will be introduced for the banking sector.
- AML/CFT Regulations – Financial Crime Commission will be established to fight against financial crime.
- Bio and Pharmaceutical will be taxed at 10% instead of 15%.
- Mauritius will be setting up of a COVID-19 vaccine manufacturing organisation.
When considering the measures announced in this Budget Speech 2021/2022, the hope of relocation to Mauritius could now become a reality! It is comforting to see that the Mauritian Government has taken a favourable approach in positioning Mauritius as a long term family friendly destination to live, work, study, invest and retire.
Bolt Talent Solutions and Bolt Home Mauritius are ready to support you and manage your relocation to the island.
As of 15 July 2021 it will be possible to make your move to Mauritius! If you require assistance in finding out more, or attaining any of the following Visas or Permits for Mauritius – contact us and book your consultation with our Concierge now!
Disclaimer: This article is shared with the aim of providing a general commentary on the proposed regulatory, tax and corporate changes announced by the Finance Minister in the budget speech that took place on Friday 11th June 2021. Please note that the provisions listed in the 2021/2022 budget speech are still subject to changes and final enactment. This does not constitute a legal or binding opinion and we urge our users to engage with our concierge service should they have specific questions or need further information. Bolt Talent Solutions accepts no responsibility of any users interpretations of actions taken on the basis on this publication or general information available on our digital platforms.