Key Taxation Proposals in the Mauritius Budget 2025-2026

Prime Minister Dr. Navinchandra Ramgoolam introduced several taxation measures aimed at fiscal consolidation, equity, and long-term economic resilience. ​ Below are the key proposals: 

Personal Income Tax 

  1. Simplified Tax Bands:  

  • 0% tax rate for annual chargeable income up to Rs 500,000. ​ 

  • 10% tax rate for the next Rs 500,000 of annual chargeable income. ​ 

  • 20% tax rate for income exceeding Rs 1 million. 

  1. Tax Relief:  

  • Tax exemption threshold increased by Rs 110,000. ​ 

  • 44,000 individuals removed from the tax net. ​ 

  • 81% of employees will not pay any income tax. ​ 

Corporate Income Tax ​ 

  1. Alternative Minimum Tax:  

  • Introduced for certain profitable sectors to ensure fairness and equity. ​ 

  1. Qualified Domestic Minimum Top-Up Tax:  

  • Imposed on large multinational enterprises to raise their effective tax rate to 15%. ​ 

Fair-Share Contribution ​ 

  1. High-Income Earners:  

  • Individuals earning annual net income exceeding Rs 12 million (inclusive of dividends) will pay a 15% Fair Share Contribution for three years. ​ 

  1. Corporations:  

  • Domestic enterprises with annual chargeable income above Rs 24 million will contribute up to 5% of chargeable income. ​ 

  1. Banks:  

  • Additional 2.5% contribution on chargeable income from domestic operations. ​ 

Value Added Tax (VAT) ​ 

  1. Lower Registration Threshold:  

  • Businesses must register for VAT upon making taxable supplies exceeding Rs 3 million (previously Rs 6 million). ​ 

  1. VAT on Digital Services:  

  • Specified digital or electronic services provided by foreign suppliers will be subject to VAT starting January 1, 2026. ​ 

Tourism Tax ​ 

  1. Tourist Fee:  

  • A fee of €3 per tourist per night will be introduced in designated tourist accommodation establishments. ​ 

Vehicle Taxes ​ 

  1. Excise Duty:  

  • Reintroduced on hybrid and electric vehicles. ​ 

  • Increased excise and customs duties on conventional vehicles (45% to 100%). ​ 

  1. Registration Duty:  

  • Increased by 30% for first registration of vehicles. ​ 

  • Abolished for the sale and transfer of domestic pre-owned vehicles. ​ 

  1. Road Motor Vehicle Licence:  

  • Increased by Rs 200 to Rs 4,000 depending on the type of vehicle. ​ 

Excise Duties 

  1. Alcohol and Tobacco:  

  • Excise duty increased by 10%. ​ 

  1. Sugar-Sweetened Products:  

  • Excise duty increased from 6 cents to 12 cents per gram of sugar. ​ 

  • Extended to chocolates and ice cream starting October 1, 2025. ​ 

Smart Cities and EDB Schemes ​ 

  1. Fiscal Incentives:  

  • Discontinued for Smart City promoters, with transitional provisions for ongoing projects. ​ 

  1. Registration Duty:  

  • Increased from 5% to 10% for non-citizens acquiring residential property under EDB schemes or apartments. ​ 

  1. Land Transfer Tax:  

  • Increased from 5% to 10% for sellers of residential property or apartments. ​ 

Tax Administration 

  1. Settlement Schemes:  

  • Tax Dispute Settlement Scheme and Voluntary Disclosure Settlement Scheme introduced for one year. ​ 

  1. Tax Arrears Settlement Scheme:  

  • Renewed for one year. ​ 

  1. Assessment Period:  

  • MRA’s powers to raise assessments restricted to two years, except in exceptional circumstances. ​ 

These taxation measures aim to balance fiscal consolidation with fairness, equity, and economic growth while protecting vulnerable groups. ​