Mauritius has ushered in a new fiscal era with the gazetting of the Finance Act 2025 on 9 August, following Presidential assent. The legislation gives effect to a series of tax measures first announced in the June National Budget by Prime Minister and Minister of Finance Dr Navinchandra Ramgoolam.

The Act introduces wide‑ranging reforms designed to align the country with international tax standards, broaden the revenue base, and recalibrate incentives for both individuals and businesses.

Global Tax Alignment: QDMTT

In line with the OECD’s Global Anti‑Base Erosion (GloBE) rules under Pillar Two, Mauritius will implement the Qualified Domestic Minimum Top‑Up Tax (QDMTT). Effective for financial years ending after 31 December 2024, the measure applies to multinational enterprises with annual turnover above €750 million.

Alternative Minimum Tax

A new Alternative Minimum Tax (AMT) of 10% on adjusted book profits will apply to specific sectors, including:

• Hotels

• Insurance

• Real estate

• Telecommunications

• Financial intermediation

Exemptions apply to Global Business entities, exempt companies, and firms benefitting from tax holidays, regardless of accumulated losses.

Fair Share Contribution (FSC)

A headline feature of the Act is the Fair Share Contribution (FSC), levied at 15% for both individuals and companies between 1 July 2025 and 30 June 2028.

• Individuals: Only income above MUR 12 million (approx. USD 265,000), including local dividends, will be subject to FSC. Dividends from Trusts and Foundations are excluded.

• Companies: Applies to entities with chargeable income above MUR 24 million, at the following rates:

  • 5% for companies taxed at the standard 15% rate

  • 2% for companies on reduced rates

  • 5% on banks’ income, including cross‑border transactions and dealings with Global Business Licence holders

  • An additional 2.5% on banks’ domestic income

Global Business Corporations (GBCs) and companies with tax holidays are excluded, and foreign tax credits cannot offset FSC liability.

Partial Exemption Regime (PER)

The 80% Partial Exemption Regime will be extended to Virtual Asset Service Providers from 1 July 2026, provided substance requirements are met. However:

• Banks will no longer benefit from PER on dividends.

• Interest income will only qualify if substance conditions are satisfied.

Property‑Related Taxes

From 1 July 2026, the Registration Duty and Land Transfer Tax (LTT) on property transactions by non‑citizens under Economic Development Board (EDB) schemes — including Smart City, Property Development, Real Estate, and Invest Hotel Schemes — will double from 5% to 10%.

Existing tax incentives for Smart City developers (such as eight‑year tax holidays and exemptions from duty or LTT) are grandfathered where a letter of comfort was issued before 5 June 2025. Beyond that date, incentives will be limited to projects tied to public infrastructure.

Banking Sector

The 35% tax rate cap for banks will now apply only to transactions with residents other than global business entities.

Labour Market Adjustment

The minimum monthly basic salary required to obtain a Professional Occupational Permit has been raised from MUR 22,500 to MUR 30,000.

Balancing Act

Commenting on the reforms, Richard Neal, Commercial Director – Africa for the Sovereign Group, noted that the Finance Act 2025 represents “a clear balance of priorities, perhaps overly ambitious.” He highlighted the challenge of raising revenue and meeting global tax obligations without undermining competitiveness or investor confidence.

Neal added that if Mauritius can implement the reforms with clarity and fairness, while monitoring their impact, the Act could mark “a turning point in the country’s fiscal maturity.”

Key Takeaway

The Finance Act 2025 is both a compliance exercise with international tax norms and a domestic revenue‑raising strategy. For investors, the message is clear: Mauritius remains open for business, but the fiscal landscape is shifting, and careful planning will be essential.