Mauritius to consider taxation on high wages and profits, faces opposition

Finance Minister Renganaden Padayachy has reportedly suggested considering taxation on high wages and profits.

Currently, according to the Mauritius Revenue Authority (MRA), “a person whose taxable income exceeds Rs 3 million is subject to a Solidarity Levy calculated at the rate of 25% of the taxable income exceeding Rs 3 million”.

According to Defi Media, the MCB group paid its directors just over Rs 93 million for the year ending 30 June 2021. Two other conglomerates disbursed Rs 69.39 million and Rs 25 million respectively for the year ending June 30, 2022, for remuneration of their executive, non-executive and independent non-executive directors. 

However, Akshar Maherally, Managing Director of WTS Tax Consulting (Mauritius) Ltd, was cited as warning that the introduction of a tax on big salaries and profits will discourage entrepreneurship, development and economic growth in the country.

Fazeel Soyfoo, International Tax Partner at Andersen, reportedly added that such a measure will not improve the mood in the business community.

“We are a few months away from the next budget and measures are anticipated on the Solidarity Levy, which was increased from 5% to 25%.

“For a country that is trying to tackle the brain drain, taxing high earners is far from being the solution,” he said.

Source: Defi Media