Manufacturing and trading: advantages of doing business in Mauritius

Strategically located on the trade route between Europe, Asia and Africa, Mauritius offers several advantages to anyone wishing to conduct business on the island. It is the perfect jurisdiction for anyone looking for a global manufacturing hub. The benefits it offers are explored below.

Business environment

Mauritius is very famous for its ease of doing business. In fact, it is ranked at number one in Africa for almost every business indicator. Setting up a company and an offshore bank account in the country is very simple even for a foreigner. Along the same lines, it is not complicated to relocate to the island, buy property and get occupation permits. As expected from any jurisdiction, there are some documentary requirements and checks. Nonetheless, foreigners can easily go through the processes with the help of a company like ours. With our assistance, they can easily buy commercial property in Mauritius and rent factories and warehouses for low prices.

Modern infrastructure

The island has a Freeport and modern infrastructure with excellent global logistics by both air and sea. Additionally, if you plan on establishing a business in Mauritius, you will not have difficulties conducting your day-to-day operations. The local population is well-educated, cost-effective and bilingual, speaking English and French. Besides that, Madagascar is often used for outsourcing certain activities, especially for textiles and this considerably reduces the costs.

Preferential access to the market

Mauritius has in place several regional Agreements, such as SADC, COMESA and IOC but also AGOA and the Interim EPA with the US and the EU respectively. Each one of these will offer foreign investors different trade and access benefits, depending on where they are exporting to. Additionally, the country has several bilateral treaties with other jurisdictions in Africa that caters for more tax, business and protection advantages. Thanks to these agreements, Mauritius is a very popular choice for trading and holding companies.

Fiscal incentives

At the time of writing, companies can benefit from the following fiscal incentives

  • 8-year income tax-holiday for companies engaged in the manufacturing of pharmaceutical products, medical devices and high-tech products,
  • 3 per cent corporate tax on profits derived from exports of goods,
  • No import duties on equipment and raw material,
  • No export duties in Mauritius,
  • VAT on raw materials is payable at customs clearance but reimbursable on exports
  • Investment Tax Credit of 5% – 15% per year (i.e. 15% – 45% over three years) for investment in high-tech manufacturing equipment (the credit amount will depend on the nature of the activity),
  • Accelerated depreciation of 50% on machinery, equipment and construction of industrial premises dedicated to manufacturing activities,
  • Companies can claim a double deduction in respect of qualifying expenditure on R&D until income year 2021-2022,
  • No Registration Duty and Land Transfer Tax on any transfer of a building or land earmarked for the construction of a building, to be utilised for setup of qualifying high-tech manufacturing activities, and

Accelerated depreciation of 50 percent per annum on capital expenditure incurred on R&D.

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