Both Acts were gazetted on 13 August 2026. Between them they give effect to the Budget 2026-2027 measures and amend a long list of legislation across taxation, financial services, corporate law, employment and immigration. There is a great deal in them and much of it is fiddly, so this is the short version, starting with the change that had everybody worried.
The Corporate Climate Responsibility levy (“CCR levy”), and whether your foreign tax credits still cover it
The change that caused the alarm was that the CCR levyCCR levy could no longer be reduced by a foreign tax credit. The answer is better than we feared. Where a treaty is in place, the credit should still be available against the levy. Sorry in advance for all the three letter acronyms.
The CCR levy itself is not new, but it has become trickier. It has applied since the year of assessment commencing 1 July 2024, at 2% of chargeable income, to any company whose turnover for the year exceeds MUR 50 million. Watch that threshold, because turnover is defined in section 50N as gross income from all sources including exempt income, so it catches more companies than you would think. What the Finance Act changes, with effect from the gazette date of 13 August 2026, is when the levy is paid and what can be set against it.
On timing, a company that submits APS Statements now pays quarterly rather than once a year. For each of the first three quarters it pays 25% of the annual levy, computed on the chargeable income used for the APS Statement and paid together with that Statement. For the last quarter it pays the annual levy less whatever it has already paid, with its annual return. Every other company carries on paying once, with the annual return.
There is then what looks like a transitional discount, and it is worth reading carefully because it is not one. Section 161A(76) reduces the levy by 75% where the APS Statement falls due between 1 July 2026 and 30 June 2027, by 50% for the following year and by 25% for the year after that. But it operates notwithstanding section 50O(2)(b)(i), and that subparagraph is the quarterly instalment and nothing else. The final payment is computed under subparagraph (ii) as the full annual levy less the amount actually paid in instalments, so cutting the instalments simply increases the balancing payment by the same amount. You keep the cash for a few months. The 2% does not move.
Now the credits. Section 50O(5) says that no credit available under the Act may reduce the levy, other than two. The first is the credit in section 161A(58A), which gives a manufacturing company incurring capital expenditure on new plant and machinery, artificial intelligence and patents a credit of 15% of the cost of the new plant and machinery, in the year of acquisition and in each of the two following years. Usefully, the Finance Act extends the window for incurring that expenditure from 30 June 2026 out to 30 June 2029. The second is any tax credit under section 76, and that is where all the anxiety came from.
This is the important bit. Section 76 is headed “International arrangements”. It lets the Minister enter into arrangements with foreign governments and gives those arrangements effect according to their tenor. It does not itself grant anybody a credit. The provision that actually grants credit for foreign tax is section 77, and section 77 is not on the list. Section 77 is also unilateral, meaning foreign tax is credited against Mauritian tax on the same income whether or not a treaty exists. Relief in Mauritius has never depended on treaty access, so the popular description of this as “credit if you have a DTA, no credit if you do not” is not quite how the system works.
Relief against the levy therefore has to be built from the treaty rather than from section 77, and on a standard treaty it holds up. Article 2 applies the treaty to taxes on income “irrespective of the manner in which they are levied”, treats as taxes on income all taxes imposed on total income or on elements of income, and extends to identical or substantially similar taxes imposed after signature in addition to the existing taxes. A 2% levy on chargeable income introduced in 2024 falls comfortably within that description. The elimination of double taxation article then obliges Mauritius to give credit against its own tax on that income, and section 76(2) gives that obligation effect notwithstanding anything else in the Act. Helpfully, section 50O(5) expressly preserves section 76 credits, and in terms it bites only on credits available under the Act, which a treaty credit is not.
Where there is no treaty, there is no relief at all. Section 77 is excluded and nothing else is available, so the 2% is a genuine additional cost on foreign income that has already borne tax abroad. The same goes for a treaty with a narrow Article 2, or one that relieves double taxation by exemption rather than by credit, so please check the specific treaty rather than assuming.
Before anyone panics, most companies will not be affected at all. Section 77(4)(a) already denies a foreign tax credit on any income for which the 80% partial exemption has been claimed, and section 77(4)(b) does the same for income taxed under section 44C. If your income is sitting on the partial exemption there was never a credit to lose in the first place. The companies that genuinely need to look at this are those with foreign income outside the partial exemption and real foreign tax suffered: foreign branch profits where the exemption is not claimed, foreign rental income, foreign trading income, and treaty dividends where credit was chosen over exemption.
One practical warning. The Income Tax (Foreign Tax Credit) Regulations 1996 are made under section 77, and every foreign tax credit in Mauritius is claimed through that machinery whether or not a treaty applies. So do expect the MRA to characterise a claim as a section 77 credit and refuse it, and be ready to make the treaty argument. For anything material, a ruling is a great deal safer than a filing position.
Everything else, briefly
Companies. The Fair Share Contribution for companies now turns on one thing only: chargeable income exceeding MUR 24 million. The turnover criterion is abolished, from the gazette date. Also from the gazette date, export of live animals no longer qualifies for the reduced 3% corporate tax rate, and three deductions disappear from the year of assessment commencing 1 July 2027, being the 150% deduction for hotel cleaning, renovation and embellishment works, the double deduction for joint tertiary education contracts with African universities, and the 8-year exemption for innovative agricultural methods under the Integrated Modern Agricultural Morcellement Scheme.
There is a quiet piece of good news on Corporate Social Responsibility (“CSR”), also from the gazette date. Every company still has to set up a CSR Fund equivalent to 2% of its chargeable income for the preceding year, but the slice that must be handed over to the MRA has been reshuffled. For a fund set up during calendar year 2026 the minimum remittance drops back to 50%, having sat at 75% since 2019, before returning to 75% for funds set up on or after 1 January 2027. So for this one year you keep more of the fund to spend on your own approved programmes, which is worth planning for rather than discovering afterwards.
There is better news on incentives too, all from the gazette date. The 8-year incentive for companies holding an EDB Investment Certificate now runs from the date the company starts operating rather than from incorporation, which is a sensible fix. Captive insurers get their 10-year exemption extended by a further 5 years where the licence was issued before 19 June 2026. And the 15% manufacturing tax credit on capital expenditure runs to 30 June 2029, as mentioned above.
Genuinely good news for start-ups: a new 10-year tax exemption, from the gazette date, for a company set up on or after 19 June 2026 and managed in Mauritius, conducting its business operations in Mauritius or Africa, falling under the National SME Incubator Scheme of the Mauritius Research and Innovation Council, and with annual turnover not exceeding MUR 100 million.
From the year of assessment commencing 1 July 2027 the definition of a global business entity tightens. A foundation qualifies only where the founder is a non-resident or holds a Global Business Licence, or all the beneficiaries are non-residents or hold such a licence, or the purpose is carried out outside Mauritius. A trust qualifies on the equivalent tests by reference to the settlor and beneficiaries, or where it is a purpose trust under the Trusts Act whose purpose is carried out outside Mauritius. A trustee of a unit trust scheme who is a non-resident or holds a Global Business Licence is now included in the definition.
ICT services, from the gazette date. Income from ICT services supplied in Mauritius is now Mauritius-source income, ICT services meaning the supply of software, software licences and software applications, software maintenance services, and distance maintenance of programmes and ICT equipment. Tax is deducted at source at 1% on payments to an ICT services provider exceeding MUR 300,000, and at 5% on payments for advertising, promotional, endorsement or marketing services delivered through social media, digital content or similar electronic means. Where the payee is a non-resident, the rate may be reduced under an applicable treaty.
Individuals. From 1 July 2026 the Fair Share Contribution for individuals goes and is replaced by a new progressive scale: nothing on the first MUR 500,000, 10% on the next MUR 500,000, 20% on the next MUR 11 million, and 35% on the remainder above MUR 12 million. From 19 June 2026 the exemption threshold for lump sums, meaning death gratuity, compensation and pension commutation, rises from MUR 3 million to MUR 3.5 million. From 1 July 2026 there is a 4-year tax holiday for qualifying non-citizen employees of companies manufacturing solar photovoltaic systems, and the disturbance allowance for public officers serving in Rodrigues or the Outer Islands becomes exempt. And from the gazette date, Golden Visa holders get the same treatment as Premium Visa holders, so foreign-source employment income is taxable only on remittance to Mauritius, spending through foreign credit and debit cards is not treated as remitted income, and funds deposited into Mauritian bank accounts are not taxed where evidence of foreign tax payment is provided.
VAT, and there is a lot of it. The rules for foreign suppliers of digital and electronic services are clarified, although not all on the same day. From the gazette date the requirement to appoint a tax representative disappears, and a definition of “online marketplace” arrives, meaning a digital platform connecting or facilitating transactions between sellers and buyers for the supply of goods and services, including websites, portals, gateways, application stores and digital distribution platforms, but excluding a platform that solely processes payments electronically. Then from 1 October 2026 registration is required only where turnover exceeds MUR 3 million, and no registration is required at all where the services go exclusively to VAT-registered persons, because the reverse charge applies.
Effective from 1 October 2026, Management companies should look hard at the next one, because it costs money and the timing has a hole in it. Services supplied by holders of an FSC management licence to GBL corporations, to trusts whose settlor and majority of beneficiaries are non-residents, and to foundations whose founder and majority of beneficiaries are non-residents move from zero-rated to exempt, which makes the related input VAT irrecoverable. The two halves of that change do not commence together. The deletion from the zero-rated Fifth Schedule is section 25(s)(ii), and it appears nowhere in section 28, so under section 46(4) of the Constitution it came into operation when the Act was published in the Gazette on 13 August 2026. The insertion into the exempt First Schedule is section 25(r)(xiii), which section 28(2) commences on 1 October 2026. On the words of the Act those supplies are therefore neither zero-rated nor exempt between 13 August and 30 September 2026, which leaves them standard-rated at 15%. We do not believe that was intended, and we would expect the MRA to treat the zero-rating as running through to 1 October. But the Act does not say so, and section 28 postpones only the paragraphs it lists. Anyone invoicing across that window should take a view on it now rather than assume, and on material amounts it is worth putting the question to the MRA.
Three more from 1 October 2026. Where no invoice is issued and no payment received, the time of supply is deemed to be 3 months after delivery or performance. Failure to declare VAT deferred at importation attracts a fixed penalty of MUR 10,000, the VAT must be declared in the next taxable period, and if it is not it becomes due and payable and recoverable by the MRA. And hotels and tourist residences receiving more than 50% of payments in specified foreign currencies must remit 50% of the VAT in that foreign currency. Separately, from the gazette date, the time limit to claim input VAT drops from 36 months to 24.
A new 5% Insurance Premium Tax arrives on 1 January 2027, applying to premiums under general insurance business for policies entered into or renewed on or after that date. Reinsurance contracts and non-Mauritian policies are excluded. Returns are monthly, payment is electronic and due by the end of the following month, except that the May and November returns are pulled forward to two working days before the end of June and December. A late return costs MUR 2,000 per month capped at MUR 20,000, and late payment attracts a 10% penalty plus interest at 1% per month. Be careful with the offence figures being quoted around this: failing to comply, or filing a return that is incomplete in a material particular, carries up to MUR 100,000 and 3 years, and it is only misleading the Director-General or wilfully filing a false return to evade the tax that reaches MUR 1 million and 8 years.
Several supplies become zero-rated from 13 August 2026: payment services provided by licensed Payment Service Providers to non-residents and GBLs, electronic books, and postal services together with services provided by a postal service licensee in connection with payment of pension and utility bills. Photovoltaic equipment is being listed alongside these as newly zero-rated, but it is not. It has been zero-rated since 2014, and all the Act does is turn “photovoltaic systems, including photovoltaic generators, panels, batteries and inverters” into a straight list, putting beyond doubt that the components qualify in their own right rather than only as part of a system. Backdated to 27 April 2026, the VAT exemption is extended to accommodation for international sports events, though not championships or leagues organised by regional or international sports federations, and to accommodation for international television and film award events.
VAT penalties rise sharply. From 1 October 2026 failure to use e-invoicing goes from MUR 200,000 and 12 months’ imprisonment to MUR 500,000 and 2 years, and a new penalty of MUR 5,000 per day, capped at MUR 1 million, applies to failure to issue a fiscal invoice. From 13 August 2026 obstruction or failure to produce records rises from MUR 200,000 to MUR 500,000, and a new penalty of MUR 100,000 and up to 2 years’ imprisonment applies to failure to submit requested information.
Dealing with the MRA. From the gazette date there is a new compliance agreement mechanism, letting the MRA and a taxpayer settle before an assessment, claim or objection determination. The agreement specifies the matters agreed together with the tax, penalties, surcharges and interest payable and the terms of payment, the taxpayer declares that he has truly and fully disclosed all material facts, and it is final, conclusive and binding on both parties. Note that the taxpayer is deemed to have waived any right to object or appeal, and that the MRA may reopen the agreement where material information was unavailable or withheld or where the taxpayer fails to comply with the terms, so this is not a step to take lightly. Also from the gazette date, an individual tax agent must be a citizen of Mauritius and must also either be a member of MIPA, be a law practitioner, have at least 3 years’ experience in accounting or taxation, satisfy the relevant committee that they have at least 3 years’ experience, or comply with such terms and conditions as are prescribed. And an appeal to the Revenue Tribunal now requires a deposit, at the time of lodging, of 5% of the amount determined or MUR 5 million, whichever is lower. Watch the timing here, because it is not uniform: for income tax and VAT determinations it applies from the gazette date, and only the customs and excise limbs wait until 1 September 2026.
Property. From the gazette date, the 10% increase in Land Transfer Tax on non-citizen acquisitions that was due to take effect on 1 July 2026 is repealed, and the general rate of 5% continues to apply to both Registration Duty and Land Transfer Tax. In its place a 10% additional duty applies on the transfer of residential property on State land or Pas Géométriques to non-citizens, payable by the seller, with an exemption where a qualifying presale agreement was executed before 19 June 2026 and signed before a notary. First-time buyers do better: the registration duty exemption threshold rises from MUR 2.5 million to MUR 3 million for bare land and from MUR 5 million to MUR 6 million for a house or apartment, and owning agricultural land no longer disqualifies you from the exemption.
Financial services. From 1 September 2026 a protected cell company is expressly brought within the class of companies that can become a Variable Capital Company (“VCC”), and a VCC may, with the prior approval of the FSC, enter into contractual obligations with or provide ancillary services to its own sub-funds, provided that doing so is not itself a licensable activity.
From the gazette date the Virtual Asset and Initial Token Offering Services Act prohibits any person, directly or indirectly, from soliciting, targeting or engaging with an investor in Mauritius for the purpose of virtual asset transactions or participation in an initial token offering, unless licensed as a virtual asset service provider or registered as an issuer. Read the definition before assuming it does not apply to you. “Solicit” catches advertising and marketing directed at or merely accessible to investors in Mauritius, communications through websites, mobile applications and social media including targeted or algorithmic advertising, events, seminars and webinars, the use of third-party agents, introducers, influencers, affiliates or referral arrangements, the provision of links or referral codes, and simply holding yourself out as able to offer virtual asset services. Most significantly, a communication or activity is presumed to target investors in Mauritius where it is made in a manner accessible to the general public, which is a very long reach indeed. Separately, and this one waits until 1 January 2027, the information sharing obligation is extended to cover section 124 of the Income Tax Act.
Also from the gazette date, the FSC may, on written application by a captive insurer that was unable to meet a time limit for a just or reasonable cause, extend that time limit on such terms as it determines. Beyond tax, the two Acts also introduce an AI City Scheme and a new Private Wealth Management Licence, extend beneficial ownership registers to partnerships and bring them up to FATF standard by adding dates of birth, and extend AML and CFT obligations to waqfs and third-party administrators.
Immigration and employment. From the gazette date the permit regime is overhauled. The Family Occupation Permit is discontinued, its definition deleted from both the EDB Act and the Immigration Act. The Investor Occupation Permit now requires an initial investment of USD 100,000 rather than USD 50,000, with minimum turnover of MUR 5 million by year three and MUR 8 million by the year five renewal. The Professional Occupation Permit now requires a monthly basic salary of MUR 50,000 rather than MUR 30,000, and the ProPass and ExpertPass categories are discontinued, although existing holders will still be assessed under the previous criteria at their first renewal. A Young Professional needs at least an undergraduate degree from a local tertiary education institution recognised by the Higher Education Commission, or an internationally recognised professional certification of at least equivalent standing dispensed by an institution registered in Mauritius. The Self-Employed route requires USD 50,000, is confined to the services sector, needs at least three letters of intent of which two must come from potential local clients, and requires turnover of at least MUR 2 million by year three and MUR 3 million by the year five renewal. A new Technical Occupation Permit covers contractual and technical workers under approved government to government agreements, who may earn below MUR 50,000 and down to the statutory minimum wage where the employer proves suitable accommodation, valid for 3 years capped at the length of the contract and renewable thereafter. The Golden Visa is issued by the Passport Officer on EDB recommendation and requires at least USD 1 million invested within 12 months in any business activity other than acquiring residential property under an EDB scheme.
Still from the gazette date, foreign students aged 16 and over holding a residence permit may now work in Mauritius, subject to obtaining a Student Employment Permit, with a 6-month transitional period for existing students to regularise their position. And all non-citizens who require a visa must hold a digital travel authorisation, applied for electronically before travel, subject to exemptions.
Finally, three significant changes to the Workers’ Rights Act, all from 1 January 2027. Every female worker becomes entitled to one day’s menstrual leave per month on full pay, meaning leave granted where she is temporarily unable to work because of severe menstruation-related symptoms or disorders, and a day taken as menstrual leave is not treated as absence from work. Maternity leave increases from 16 to 26 weeks on full pay, of which at least 14 weeks must be taken immediately following confinement, with an option to take a further 26 weeks on half pay. And paternity leave increases from 4 to 6 consecutive weeks. Employers should be budgeting for these now. Separately, the State Age Pension is being reformed, with the pension age rising in steps from 60 to 65 under a new schedule that completes in September 2034. Drawing the pension early remains possible, reduced by 0.5% for each month taken before pension age, and deferring it earns an increase.
If any of the above affects your structure and you would like to talk it through, please get in touch.
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