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com/mu

Going over the National

Budget
19 November 2010
Special Note:

Please note that Budget proposals may be

subject to amendments during debates in
Parliament. We therefore recommend you to
seek professional advice before taking
decisions based on these measures. PwC will
release a special edition on the Finance Act
2011 once it is voted.

Going over the National Budget – November 2010 Contents

PwC 2
Contents

André Bonieux, Senior Partner, comments on the National Budget

Tax Perspective
Public Finance
Sector Review Agro-Industry
Banking, Financial Services & Offshore
Employment & Social Measures
E
Energy & Sustainable
S i bl D Development
l
ICT
Hospitality, Tourism & Leisure
Manufacturing
g
Public Infrastructure
Real Estate
SMEs

Taxation and Tax Tables

About PwC
Contacting
g Us

Going over the National Budget – November 2010 Back to Contents

PwC 3
Can do much better!
(1 of 2)
The Honourable Pravind K. Jugnauth, Vice-Prime Minister,
Minister of Finance and Economic Development, came up with
a set of disappointing proposals in his 2011 budget speech.
The Minister talked of productivity challenges, that the time had
come ‘to cut the links with a social policy framework that was
excessively centred on giving and spending’, and that we should
focus on empowerment and social integration.
integration
The measures announced, in our view, fell well short of these
ambitious statements.
Driving productivity at the national level is about Government
spending
di less
l anddbborrowing
i lless. Wh
Whatt was d done about
b t th
the
deficit?
With GDP growth rates of 4.1% in 2010 and 4.2% expected for
2011, clearly the envy of many countries, we feel that the
Minister had ample room for manoeuvre to act on the deficit.
Instead the budget deficit is only expected to move from 4.5%
this year to 4.3% in 2011. We would have understood this level
of deficit had Government suffered from a drop in its fiscal
revenues.
Going over the National Budget – November 2010
PwC
André Bonieux, Senior
Partner, comments on the
National Budget
Instead, and against expectations, it appears that Government did
have reasonable fiscal buoyancy as the revenue shortfall of
Rs3.8bn was due to reductions in dividends and EU grant monies.
We also expected a much more elaborate discussion on the deficit
options and strategies for the medium term. These issues were
unfortunately not addressed.
So instead of less Government, measured through a lower deficit,
it looks like we will get more of the same.
Next on the social policy framework, we heard of a vast number of
schemes, new bodies, special tax exemptions, all of which will
probably
b bl require
i yett more civil
i il servants
t tto administer
d i i t andd control.
t l
The budget speech had a strong political undertone with monies
being paid out to various categories of citizens depending on a mix
of seemingly complex conditions. We are at a loss as to how we
shall be moving away from that ‘social policy framework that was
excessively centred on giving and spending
spending’.
Back to Contents
4
Can do much better! André Bonieux, Senior
(2 of 2) Partner, comments on the
National Budget

On the empowerment front, the Minister has reintroduced
taxation on dividends, a tax that was removed in the early 90’s.
Th rate
The t shall
h ll be
b att 10%.
% Taxing
T i dividends
di id d iis, iin our view,
i a
highly retrograde measure as income is effectively taxed twice
and is a clear disincentive to entrepreneurs and investors. More
contradictory, the Minister removed taxation on interest as ‘it
was a tax that weighed too heavily on our elders’ and yet is
penalising those very elders that took higher risks and invested
in private and public companies! The impact of this tax on the
flight of capital to safer shores should not be underestimated.
All is however not negative. Tax on interest and the NRPT have
been abolished and new homeowners will get an additional
i t
interestt exemption
ti on acquisition
i iti off a new h
home.
Further, we have for years lobbied for refunds from
Government (including the MRA) to be interest bearing. The
Minister did not give much detail but announced measures to
ensure that henceforth Government would pay its dues on time,
and that delayed payments would be subject to interest – we
shall see!

Moreover, all gains from sales of land and immovable property In conclusion, we believe the Minister should have shown much
5 , except
shall be taxable at 15%, p if the development
p is in the name more fiscal discipline and gone for a deficit of around 3.75%.
of an individual, in which case the rate will be 10%. Taxation of dividends is a definite ‘no go area’ and we can only
be extremely concerned as to measures in this area in future
It is clear that we shall be moving back to a world where tax years.
planning was a serious activity for many people. Again, at PwC,
we believe that the way forward is through simplification of our
i
income tax
t llaws as thi
this iimproves collection
ll ti and d compliance.
li

Going over the National Budget – November 2010 Back to Contents

PwC 5
Tax Perspective by Anthony Leung Shing,
(1 of 2) Tax Director

The Honorable Vice-Prime Minister, Minister of Finance and Economic Development has, for his first budget, announced a series
of measures aimed at three aspects: rebalancing growth, promoting productivity and enhancing social justice.

From a fiscal perspective, the proposed amendment to the law to allow companies holding a Category 1 Global Business Licence, to
carry out operations inside Mauritius is welcome. Mauritius, as a financial centre, has often been criticised as being a tax haven and
h over the
has, h years, ffaced
d tough
h challenges
h ll ffrom fforeign
i tax authorities;
h i i India
di iis an obvious
b i example.
l Theh ring-fencing
i f i off the
h
activities of an onshore company and an offshore company has not helped to defend our position. This change in policy would
provide a much needed boost to the sector at a time when substance is becoming an increasingly critical issue for the taxman. This
would allow for more activities to be undertaken in Mauritius, thereby demonstrating more commercial presence and substance.

On the tax administration front,

front the Ministry of Finance is looking to further improve the processing cycle,
cycle through its objective of
achieving 100% submission of returns via e-filing. Previous budgets provided measures for corporate bodies to adopt e-filing and
now incentives are being given to the individual taxpayer to make such a move. As a first step, an extension of a further 15 days in
the filing deadline of the individual taxpayer, opting for e-filing, is noteworthy but, as with corporate bodies, compulsory e-filing
for individual taxpayers is not far away.

The Minister has also called for the application of interest payments on late refunds of corporate income tax by the Mauritius
Revenue Authority (“MRA”). Save for PAYE and VAT refund, no interest is paid by the MRA on late refunds. We have, for many
years, campaigned for this to be legislated and we are pleased that this measure will restore some element of fairness in the tax
collection process.

The Government is continuing its vision for a greener Mauritius.

Mauritius The immediate doubling of tax on plastic bags,
bags PETS and cans is
a clear indication of the determination to achieve this objective. Additionally, the Government is also proposing to align its green
measures with those adopted by developed economies to address the environmental issue. The proposed change in the system of
motor vehicle taxation to fully reflect the polluter-pay principle and to be based on a CO2 emission standard is a move in that
direction. Going forward, we can expect taxation to be further aligned with green metrics.

Going over the National Budget – November 2010 Back to Contents

PwC 6
Tax Perspective by Anthony Leung Shing,
(2 of 2) Tax Director

Solidarity taxes have now become a common feature of the National Budget and, yet again, the Minister has
appealed to those who can afford to contribute more. The extension of the application of the Special Levy on
banks and the Solidarity Levy on telephony companies are such examples. The Minister has gone even
further and introduced a new levy on the Segment A banking activities to compel the banks to contribute
more. The Solidarityy Tax has also been extended to individuals,, wherebyy a person
p with a total income
exceeding Rs2m will pay a solidarity tax of 10% on his exempt income. This effectively means the
introduction of a tax on dividend income for individuals; however, dividends would still be exempt in the
hand of a recipient company. It is an agreed fact that the taxing of dividend is economic double taxation and
most modern tax jurisdictions are moving away from such a concept. Further, at a time where the
Government is seeking to stimulate SMEs, entrepreneurship and owner-managed businesses, such a tax
would be detrimental.

The Minister also introduced a new 10% tax on individuals in respect of any gains (exceeding Rs2m) derived
on sale of land and immoveable properties. In many instances, such gains made by an individual were
previously deemed to capital in nature and therefore not subject to tax in Mauritius. In essence, this 10% tax
represents nothing but the introduction of capital gains tax in Mauritius.
Mauritius

Amidst these new taxes, the Minister has also provided for some relaxation in taxes, with the abolition of the
National Residential Property Tax (“NRPT”) and the exemption of interest income with retrospective effect
from 1 January 2010. However, the removal of these taxes represents mere promises which the Minister
provided during
p g his electoral campaign
p g and much of the rebalancing g has been achieved through g the
introduction of new taxes or so-called solidarity taxes to promote social justice. Overall, the fiscal burden is
targeted at the profitable companies and the high income earners, with the objective to take from the “haves”
to give to the “have not”.

Going over the National Budget – November 2010 Back to Contents

PwC 7
Public Finance

The 2010 budget deficit is projected at around 4.5% as announced in

2009. This reflects lower than expected public spending (Rs4.2bn)
combined with lower grants being received in 2010 (Rs2.6bn). We
also note a deficit in financial transactions mainly due to the non-
q y sales of Rs1.5bn.
realisation of equity 5

The budget deficit is expected to be around 4.3% of GDP in 2011 and

4.1% in 2012. Public finances will not return to below the 4% mark
until 2013 (deficit of 3.9% of GDP) on the assumption of 4.5%
economic growth.

Despite the reshuffling of tax measures, tax revenue is forecast to

remain roughly the same as a percentage of GDP from 2010 to 2013,
slightly above 18%. No major change is expected in the level of
grants.

Public spending in 2011 is expected to amount to Rs84.0bn, representing a 10.2% increase over 2010 expenses of Rs76.3bn.

Public sector borrowing is estimated at around Rs180.4bn (60.7% of GDP) in 2010, up from Rs168.1bn (60.0% of GDP) in 2009.

The forecasts show a further surge in public borrowing to Rs214.5bn (a record 61.1% of GDP) in 2012. This reflects the effects of
increased Government spending in 2011 and 2012.
2012 Borrowing as a percentage of GDP is then expected to decline in 2013.
2013

Going over the National Budget – November 2010 Back to Contents

PwC 8
Sector Review

Agro-Industry
Banking, Financial Services & Offshore
Employment & Social Measures
Energy & Sustainable Development
ICT
Hospitality,
l Tourism & Leisure
Manufacturing
Public Infrastructure
Real Estate
SMEs

Going over the National Budget – November 2010 Back to Contents

PwC 9
Agro Industry
Agro-Industry

• The measures announced under the ERCP in August are being • Recommendations in view of enhancing the viability of sugar
implemented, including the decision to reduce the Global Cess producers will be implemented through amendments brought to
the Sugar Insurance Fund Act
• Small planters, relying on sugar income only, will benefit from
the reintroduction of the tax exemption on the first 60 tonnes • The 80% advance scheme applicable to the 2010 sugar crop will
off sugar. No submission
b i i off iincome tax return will
ill b
be required
i d l apply
also l to the
h 2011 crop

• Abolition of the 15% income tax on the surplus generated from • Appropriate measures will be taken to ensure that the VAT
sugar operations by Cooperative Credit Societies (CCS) benefits currently provided to medium and large exporters of
sugar will also be available to small planters
• Loans up p to Rs25,000
5 g
given byy CCS to their members will
attract a concessionary fixed fee of Rs200 on registration and • The duty-free facility will be re-introduced on all types of double
inscription of the documents cab vehicles (4x4) for eligible small planters, farmers,
fishermen’s cooperative societies and qualified SMEs
• Rs310m will be provided for the Field Operations, Re-
grouping and Irrigation project to cover another 1,300 • A National Agricultural Biotechnology Institute will be set up in
h t
hectares off lland
d iin 2011 d tto enable
order bl th
the non agricultural
i lt l sector
t tto ffully
ll bbenefit
fit ffrom
the high tech development in the domains of agriculture, agro-
• Rs15m will be provided to maintain the incentives regarding industry and fisheries
the Fair Trade Initiative. By 2012, small and medium planters
will get the benefit of some 40,000 tonnes • Rs15m is being provided for the Multipurpose Containment
ac y to
Facility o eensure
su e b
bio-security
o secu y
• The price of molasses sold for producing potable alcohol will
be increased by Rs10 per litre of absolute alcohol representing • Two hydroponics villages will be set up as pilot projects for small
an additional revenue of Rs300 per tonne of sugar for every planters in the non-sugar sector to modernise their activities
planter
• Rs105m will be provided (which is twice the amount disbursed
in 2010) to accelerate the Food Security project.
project Some 11
projects will be supported
Going over the National Budget – November 2010 Back to Contents
PwC 10
Banking Financial Services and Offshore
Banking,

• The potential merger of the Bank of Mauritius and Financial • Any surplus generated by the activities of the Financial
Services Commission (FSC) into one single regulatory Services Commission will be transferred into the Consolidated
institution Fund

• Further enhancement of the Islamic related banking business p

• The Development Bank of Mauritius will be transformed into
b contributing
by ib i USD5m to the h International
i l Islamic
l i Liquidity
i idi a Development Finance Agency to encourage commercial
Management Board banks to lend to SMEs
• Amendments in the Banking Act to empower the Bank of
Mauritius regarding monetary policy and operational matters • The Registrar of Companies will act as a one stop shop for non
regulated activities
• Companies holding a Category 1 Global Business License will
be allowed to conduct business both inside and outside • The existing special levy on banks will be extended for the
Mauritius instead of outside Mauritius only. The local next two financial years and there will be an additional levy of
operations will be subject to same rate of tax as other domestic 1.25% on profits and 0.5% on turnover for onshore banking
entities activities

• Amendment of the Trust Act to apply the rule of perpetuity

and allow unlimited duration of non-charitable purpose trusts

• Independent consultant will be appointed to review the

o e a y Policy
Monetary o cy Co
Committee
ee framework
a e o

• Creation of a Sovereign Wealth Fund with an initial portfolio

of USD500m to ensure greater stability of the foreign
exchange market

Going over the National Budget – November 2010 Back to Contents

PwC 11
Employment and Social Measures

• To associate the economic development with social justice, the
Budget was focused on three values namely compassion,
kindness and generosity. A special attention was also given to
the most vulnerable group of the population
• Rs11.6bn
b hhave bbeen allocated
ll d ffor the
h modernisation
d i i off
learning tools, of which Rs215m will be invested next year to
upgrade primary schools, Rs678m in secondary schools,
Rs870m to tertiary education and Rs670m to other ministries
for running programmes such as free transport for students
• Rs8bn have been assigned to the upgrading of hospitals
(Victoria, Flacq, Triolet, Agalega, etc), conducting feasibility
studies for children’s hospital, patients with mental problems,
and national health laboratory
• The Governments introduces the housing with good living in
five different schemes and increases the threshold of income
to benefit from exemption of exam fees
• Alternatives to Social Aid are also available and include both
i i and
existing d new programmes at the h NEF. The h programmes
may be sponsored and are estimated at Rs5bn for the next 10
years, including:
- Training programmes to enhance employability,
including life skills training;
- Provision of crèche facilities and after school care to
release parents, especially mothers to undertake income
generating activities;

• In addition to improving the health care facilities, the - E

Ensuring
i ththe well-being
ll b i off ffamilies
ili with
ith special
i l focus
f on
Government also aims to promote healthier consumption care and education of children;
habits by increasing tax and alcohol and tobacco - Upgrading the living environment of the beneficiaries;
• The creation of a Galerie d’Arts Nationale, Espace Culturel et - Promoting harmonious community living; and
Artistique Château Mon Plaisir will cost Rs250m whilst
Rs100m have been earmarked for digitalising the documents - Social housing with good living.
of the National Archives and implementation of Matching
Grant Scheme

Going over the National Budget – November 2010 Back to Contents

PwC 12
Energy and Sustainable Development
(1 of 2)
• The Minister continues the vision of Maurice Ile Durable • The Government has adopted two-pronged measures to
(MID) which is about preventing pollution, producing cleaner, encourage eco-friendly usage of resources on the one hand
eco-efficiency, enhancing human health and quality of life, and apply a host of fiscal disincentives to reduce the carbon
preserving the natural landscape, and encouraging clean footprint and assess its social policy
renewable energygy p
production and achieving
g energy
gy sufficiencyy
and efficiency. h Government will
• The ill d
develop
l b by April
il 2011, a national
i l
framework for sustainable buildings and construction. It will
• Projects worth Rs27bn (with almost Rs3bn in 2011) are be part of the National Programme on Sustainable
committed to the management of solid waste, wastewater and Consumption and Production (SCP) funded by the European
drainage systems. These projects include: Union

- Additional work on the landfill site at Mare Chicose • 43 other projects will be implemented under the SCP to
increase resource efficiency, improve energy consumption
- Construction of a hazardous waste facility at La patterns, and increase the supply and use of sustainable
Chaumière products and services
- A new ttransfer
f station
t ti att L
La Chaumière
Ch iè tot replace
l th
the one • Energy standards and efficiency labeling for domestic
at St Martin appliances will be enforced and the tax framework will be
• The Plaines Wilhems Sewerage Project (benefiting some reviewed to promote the use of more energy efficient
65,000 more inhabitants) will proceed, and a further Rs1.3bn appliances
es ed next
invested e yea
year in wastewater
as e a e se
services
ces • The Government will also develop a “Sustainable
Sustainable Public
• Three major sewerage projects in the regions of Grand Baie, Procurement” policy in collaboration with the United Nations
the West Coast and Pailles Guibies Environment Programme and carry out energy audits in seven
buildings
• Sewer reticulation and house connections in Port Louis and
Plaines Wilhems

Going over the National Budget – November 2010 Back to Contents

PwC 13
Energy and Sustainable Development
(2 of 2)
• Rs30m have been earmarked for the concept of eco-villages in • The rate of excise duty on PET bottles, plastic bags and cans,
Mauritius and Rodrigues will be doubled from Rs1 to Rs2 with immediate effect

• The scheme for the Solar Water Heater grant is being • The MID levy on each litre of petroleum products and each kg
reinstated at Rs10,000 per household and reinforced with the of coal and LPG will be increased to 30 cents
collaboration
ll b i off commercial
i lb
banks
k

• Negotiations are also under way for the production of

electricity from landfill gas at Mare Chicose

g
• The sustainable use of marine resources is encouraged,
through new schemes to assist with the semi industrial
exploitation of our off lagoon resources. A grant scheme of
25% on the purchase of semi industrial boats is introduced,
with a budget of Rs72m earmarked for the scheme to cover all
compliant boats currently on order

• The legal framework is also adjusted so that Mauritius can

benefit fully from the Land based Oceanic Industry, topped up
by a budget of Rs100m to finance Research and Development

• Thee fiscal
sca system
sys e around
a ou d motor
o o vehicles
e c es will cchange
a ge a
and
d be
aligned with CO2 emissions and an underlying study will be
carried out by the IMF, which should report thereon around
March 2011

Going over the National Budget – November 2010 Back to Contents

PwC 14
ICT

• Anticipated decrease of an average of 16% to 24% in the cost of internet broadband

• Setting up of a special purpose vehicle to ensure a further undersea cable link

• Implementation of smartcard based National Identity Card

• Introduction of e-Government across several ministries and departments to increase competitiveness and productivity

• Integration of the latest technology into the classrooms

• Capacity building through the setting up of education programmes for ICT/BPO

• Upgrade of existing computerised systems to make them more efficient and user-friendly

• Introduction of scanning technology in the Registrar of Companies to increase efficiency

• Increase in the use of on-line submission and e-payment facilities across all government services

• Computerisation of the functionalities and processes of the Mauritius Police Service to connect to the Judiciary, Office of DPP
and the Prisons Service

Going over the National Budget – November 2010 Back to Contents

PwC 15
Hospitality, Tourism
Hospitality
and Leisure
• Measures geared towards the promotion of tourists from non-
euro zone markets, with the aim of reaching more than 50% of
total tourist arrivals from these markets by 2015

• An investment of Rs1bn over the next 5 years is expected with

government contribution
ib i off Rs250m as ffollows:
ll

- Rs100m to double tourist arrivals from India to

115,000 by 2015

75 to attract 100,000 visitors from China byy

- Rs75m
Manufacturing
2015 and

- Rs75m allocated to the Russian market

• Setting up of a dedicated sub fund of the Private Equity Fund
• An additional Rs340m allocated for the promotion of to help enterprises invest in high tech ventures
traditional markets,
markets resulting in a total budget of Rs390m for
• Mobilisation of a further Rs600m through the Manufacturing
the MTPA in 2011
and Services Development and Competitiveness (MSDC)
• Measures to align the tourism industry with the duty free program to enhance access to finance, strengthen institutional
shopping paradise vision and promotion of cultural tourism support and improve access to quality business development
services through the Mauritius Business Growth Scheme
(MBGS)

• Additional funding of Rs700m for the Leasing Equipment

Modernisation Scheme (LEMS) and an extension of the
scheme until December 2012

Going over the National Budget – November 2010 Back to Contents

PwC 16
Public Infrastructure
(1 of 2)
The Budget focused on the public infrastructure necessary to foster both the economic growth of the country
as well as address the needs of the population at large. With this vision, the Government plans to invest more
than Rs250bn over the next 10 years in infrastructure projects

Projects which were announced in previous Budgets but which are yet to be implemented or are still in
progress include:
i l d

• Airport infrastructure, including the extension of the terminal capacity, investment to accommodate
wide-bodied aircrafts, airport emergency runway and resurfacing of the existing runway (Rs. 11.1bn)

• p
Expansion of the Container Terminal at the Port (Rs3.5bn)
35

• Road decongestion measures such as construction of the Harbour Bridge, the Ring Road, the Terre
Rouge-Verdun-Ebène link road and the Bus rapid Transit System

• The trading hub of Jin Fei

• Construction of the Bagatelle Dam (Rs3bn)

Going over the National Budget – November 2010 Back to Contents

PwC 17
Public Infrastructure
(2 of 2)
The Government also announced the following new projects:

• The upgrade of primary and secondary schools (Rs1bn), as well as the construction of a number of pre-primary schools

• Rs8bn investments in the health sector, including the completion of the New Jeetoo Hospital, the upgrading of hospitals, more
capacity for surgery at Victoria Hospital
Hospital, new blocks at Flacq Hospital,
Hospital a specialised hospital for the elderly
elderly, more infrastructure
capacity at the Bharati Eye Hospital, a new medi-clinic at Triolet and a maternity unit in the area health centre in Agalega

• Rs7bn expenditure over 2011 for the enhancement of law and order, including the purchase of an Offshore Patrol Vessel
(Rs1.7bn), upgrading of existing Police infrastructures, construction of a new regional detention centre at Piton, a high-security
prison for 775 detainees at Melrose, a new fire station at Tamarin and the acquisition
p q of one fire engine
g with an aerial platform
p

• Multi-purpose sport complex at Triolet (Rs60m) and St-Pierre

• Various other infrastructural projects for the welfare of children such as a shelter at Cap Malheureux and a residential drop-in
centre for development and protection of children

The Government has also announced the merger of the Central Water Authority, the Irrigation Authority, the Water Resources Unit
and the Wastewater Authority into one single Water Authority in order to improve the efficiency of water management in the
country.

Other measures announced and in line with the “Maurice Ile durable” effort include:

• Replacement of old and defective pipes (Rs454m), upgrade of the pipe treatment plant at Pailles (Rs245m), drilling of new
boreholes and upgrading of existing dams (Rs53m)

• Some Rs27bn worth of projects (Rs3bn in 2011) for the management of solid waste, wastewater and drainage systems.
Government will invest some Rs1.3 bn next year in wastewater services.

Going over the National Budget – November 2010 Back to Contents

PwC 18
Real Estate

To facilitate land development, the Minister of Finance is
introducing the Land Productivity Enhancement Scheme
(LPES) and reviewing procedures with regards to land
conversion. The LPES will provide a matching platform between
the p
promoters and the market,, while facilitating
g land use. The
scheme will however not be available for residential
morcellement developments, except for mixed commercial
developments.
The review of procedures includes:
• A clarification of the requirements relating to permits;
• An application for a transfer of conversion rights to another
site may also be made for a change in use;
Tax will also be introduced on all profits derived from property
transactions, 15% for companies and 10% for individuals (a
Rs2m exemption threshold applying to the latter category).
Other tax measures will include:
• Sociétés involved in real estate business will be taxed in
their own name at 15%;
• The surcharge of 5% on Land Transfer Tax introduced in
2008 will be removed;
• New industrial leases on Pas Géométriques will allow the
offset of rental paid under the old lease against rental under
the new lease;

• Conversion
C i rights
i ht may b
be ttransferred
f d tto unrelated
l t d parties
ti • No registration duty will be payable for first time buyers of
subject to a fee; a house or bare residential land subject to certain
conditions.
• Conversion rights may be transferable within a group of
companies and between ascendants and descendants/ co-
e s;
heirs;

• The removal of certain exemptions;

• For smaller land owners, a change in the threshold for

exemption from Land Conversion Tax from one to two
hectares
hectares.

Going over the National Budget – November 2010 Back to Contents

PwC 19
Small and Medium Enterprises (SMEs)

• 100% duty free facilities will be re-introduced on all types of • The ERCP will:
double cab vehicles for qualifying SMEs
- provide guarantees to allow SMEs to raise working
• Rs600m will be mobilized through the Manufacturing and capital;
Services Development and competitiveness (MSDC) to
support SMEs; off which,
hi h Rs150m will
ill b
be used
d to ffacilitate
ili - finance SMEs through factoring; and
access to finance - provide guarantees on import loans of SMEs.
• The DBM will be transformed into a Development Finance • Use of the circular migration program with France as an
Agency (DFA) to support SMEs incubator to SMEs
• The DFA will provide lending facilities to qualified clients of • Government will seek international assistance to draw up a
amounts up to Rs5m plan for banks willing to engage in the SME segment
• The DFA will offer partial risk guarantees to commercial • The SME Partnership Fund will be revisited to introduce
banks to ensure lending to SMEs instruments for the deleveraging of SME
• The DFA will provide technical support to SMEs • A new Private Equity Fund will be created in order to develop
• A new coordinated institutional framework will be set up to financing instruments for SMEs
bring under one umbrella the Small and Medium Enterprises
Development Authority, National Pay Competitiveness
Council, National Institute for Cooperatives
Enterpreneurship, National Women Enterpreneurs Council
and Enterprise Mauritius

Going over the National Budget – November 2010 Back to Contents

PwC 20
Taxation and Tax Tables

Personal Taxation
C
Corporate
t TTaxation
ti
VAT
Other
Comparative Tax Tables

Going over the National Budget – November 2010 Back to Contents

PwC 21
Taxation and Tax Tables
Personal Taxation
• A Solidarity Income Tax at the rate of 10% of exempt income • Tax exemption on the first 60 tonnes of sugar for small
derived by individuals earning a total income, including planters with less than 15 hectares of land and who rely solely
exempt income, exceeding Rs2m is introduced on sugar income is reintroduced. They will also be dispensed
of the requirement to submit a tax return
• Interest will be treated as exempt income with effect from 1st
January 2010. Tax withheld
i hh ld at source on iinterest d
during
i 2010 • All
ll profits
fi and
d gains
i dderived
i db by an iindividual
di id l ffrom
will be refunded in the form of a tax credit in the 2012 and transactions in land and other immovable property, including
2013 tax returns. Unused tax credits will be refunded in the morcellements, will be taxed at the rate of 10 percent. The first
form of cash in 2013 Rs2m of gains will be exempt and the tax will not apply to land
and immovable properties received by way of inheritance or
• First time home owners who are not subject to Solidarity t
transferred
f db
by th
the parents
t tto th
their
i hheirs
i
Income Tax will be allowed a deduction of up to Rs120,000
for interest paid on mortgage loans for the first five years of • For determining the price of acquisition of property, a cut-off
the loan. The deduction will be extended to mortgages taken date of 1988 will apply for all properties acquired before that
since 1 July 2006 date. Their prices will be adjusted according to a set formula

• Individual taxpayers who are not subject to the Solidarity • Sociétés in real estate business will be taxed in their own
Income Tax, and whose children, up to a maximum of three, name instead of the individual partners at the rate of 15 %
are following a non-sponsored full-time undergraduate course
at a recognized tertiary education institution will be allowed • The amount of income tax exemption for lump-sum on
Rs80,000 per child for courses followed in Mauritius and retirement and severance is increased from Rs1m to Rs 1.5m
Rs125,000 per child
h ld ffollowing
ll courses overseas. The
h ffiscall • The due date for payment of income tax by an individual
support will be available for 3 consecutive years of study taxpayer who submits his annual income tax return and
• The National Residential Property Tax is abolished with effect effects payment of tax electronically is extended by 15 days
from 1 January 2010

Going over the National Budget – November 2010 Back to Contents

PwC 22
Taxation and Tax Tables
Corporate Taxation
• To reinforce and enhance the Freeport and logistics platform,
the companies in the freeport zone will be exempt from tax for
another 2 years up to the year ending 30 June 2013
• To invigorate further the global business sector and the
d
domestic
i economy, companies i hholding
ldi a Category 1 Global
l b l
Business Licence will be allowed to conduct business in
Mauritius
• The GBC 1 companies will be taxed at the same rate as the
domestic entities on their domestic operations and will still
benefit from the foreign tax credits on income from foreign
sources
• The Cooperative Credit Societies will be exempted from tax on
the surplus generated from sugar operations
• The amount of capital allowances that can be claimed on
motor cars is limited to Rs3m per motor car
Going over the National Budget – November 2010
PwC
• In view of eradicating poverty and alleviating other social
problems, profitable banks will continue their solidarity
contribution for the next two financial years. Thus, the
increased special levy rate of 3.4% of profits and 1% of
pp y for the yyears of assessment starting
turnover will apply g1
January 2011 and 2012
• There will also be a supplementary charge for Segment A
banking activities consisting of 1.25% of profits plus 0.5% of
turnover. Each bank contributing to the new Private Equity
Fund will be able to offset the amount subscribed against the
additional charge, as announced in the ERCP
• The special solidarity levy applicable to providers of fixed and
mobile telephony services will be maintained for the next two
financial years. Thus, the levy will be payable for the two years
of assessment commencing on 1 January 2011 and 2012 at the
rates of 5% on book profit and 1.5% on turnover of the
preceding year
Back to Contents
23
 Taxation and Tax Tables
VAT
• VAT on goods and services supplied by the Mauritius Turf Club and horse stables,
and on the management services to tote operators will be introduced

• Exemption provided to Private Health Institutions relating to cosmetic surgery is

removed

• From 1st March, wheat flour and bran, edible oils, margarine, sterilised liquid milk,
curdled milk and cream and yoghurt, live chickens and chicks, animal feed and
fertilizers will be moved from zero-rated to exempt supplies. Producers of such
goods will be able to recover input tax when they export

Going over the National Budget – November 2010 Back to Contents

PwC 24
Taxation and Tax Tables
Other (1 of 2)
• Customs duty on cosmetic products and pharmaceuticals imported as samples for testing purposes in Mauritius is removed

• The license fees payable in respect of liquor and alcoholic products under the Excise Act will be doubled

• Rates of excise duty will be increased on rum and liquor by Rs100 per litre

• The rate of excise duty for all other alcoholic products will be raised by 20%

• The rate of excise on spirit cooler will be increased by 50%

• The rate of excise duty on cigarettes and tobacco products will be raised by 25%

• The specific rates of excise duty on petroleum products which have remained unchanged since 2002 are increased by 10%

• An adult first-time buyer of a house or bare residential land will not bear registration duty if his total annual income is below
Rs2m. This benefit will apply on the first Rs1.5m of the price of a house, or the first Rs750,000 of the price of bare land provided
the beneficiary begins construction within one year and completes within three

• The threshold for exemption from land conversion tax for the small and medium planters will be raised from one to two hectares
on certain conditions. Planters regrouping their land assets will benefit from their individual tax exemptions

• Following the introduction of the taxes on profits and gains on sale of land, the surcharge of 5% on land transfer tax introduced
in 2008 will be removed

• When a lessee of an industrial lease on Pas Géométriques and State Land opts for a new lease at market value any rental paid in
advance under the old lease will be allowed to be offset against the increased rental under the new lease for the same period

• The system of motor vehicle taxation will be changed to fully reflect the polluter pay principle and to be based on a CO2 emission
standard

Going over the National Budget – November 2010 Back to Contents

PwC 25
Taxation and Tax Tables
Other (2 of 2)
• Government will modulate taxation to promote the use of more energy efficient appliances

• The rate of excise duty on PET bottles, plastic bags and cans is doubled from Re1 to Rs2

• License fees of casinos and Gaming Houses ‘A’ are increased from Rs500,000 to Rs3.5m

• License fees of Gaming Houses ‘B’ are increased to Rs50,000

• License fees of Gaming Slot Machines are increased to Rs125,000

• Horseracing license fees for bookmakers are increased by 67%

• License fees of all other betting outlets, including totalisators, football betting outlets and bookmakers
operating through remote control communications are increased by 100%

• License fees of sweepstake organizers, local pool promoters, agents of foreign pool and operators of dart
games are increased by 50%

• The pool betting duty on foreign football matches is raised from 10% to 12%

• The rate of tax on fixed odds betting on football matches and horse racing is raised from 8% to 10%

Going over the National Budget – November 2010 Back to Contents

PwC 26
PAYE and CPS Thresholds and Personal Tax Rates
PAYE and CPS Thresholds

Year of Assessment (YOA) 2012 2011 2010 2009/2010 2008/2009

31.12.11 31.12.10 31.12.09 30.06.09 30.06.08
Income Year Ended
(N1) (N1) (N2)
PAYE and CPS THRESHOLDS Rs. Rs. Rs. Rs. Rs.
Exempt employee - PAYE (monthly income<=)
- Non sugar 18,500 18,500 18,500 18,500 16,500
- Sugar (Inter crop) 18,500 18,500 18,500 18,500 16,500
- Sugar (Crop) 18,500 18,500 18,500 18,500 16,500
Exempt Person - CPS
Turnover for CPS THRESHOLD
Trade <= (N3) 500,000 500,000 500,000 300,000 300,000
Profession <= (N3) 100,000 100,000 100,000 75,000 75,000
Rent (per month)<= 25,000 25,000 25,000 20,000 20,000
Small sugar cane and tobacco growers (N4) All All All All All

Tax Deduction at Source

Interest 15% 15% 15% 15% 15%
Royalties 10% 10% 10% 10% 10%
Rent 5% 5% 5% 5% 5%
Payments to contractors and sub-contractors 0.75% 0.75% 0.75% 0.75% 0.75%

Note:
N1 The tax year has been aligned with the calendar year, covering January to December

A six month tax year for July 2009 to December 2009 had been introduced to align the tax year with the calendar year. The income taxes due for this period were settled by
N2
5 April 2010

N3 Turnover is for a quarter as from YOA 2007/2008

N4 Small planters with less than 15 hectares will be exempt on their first 60 tonnes of sugar and will also be dispensed of the requirement to submit a tax return

Going over the National Budget - November 2010 Back to Tax

PwC
PAYE and CPS Thresholds and Personal Tax Rates (cont.)

Personal Tax Rates

Year of Assessment 2012

Flat rate 15%

Solidarity Income Tax on exempt income (N5)

10%
Tax on income from dealings in land and immoveable property (N6)
10%

Note:
N5 Applies to individuals with total income including exempt income of more than Rs2m
N6 This will not apply to gain on properties received by way of inheritance or transferred by the parents to their heirs. Moreover, the first Rs2m of gains will be exempt.

Year of Assessment 2008/2009 to 2011

Flat rate 15%

Year of Assessment 2007/2008

1. Chargeable Income not including interest income
First Rs. 500,000 15%
Remainder 22.50%
2. Chargeable Income from Interest Income 15%

Year of Assessment 2006/2007 2005/2006

On first Rs. 25,000 of chargeable income 10% 10%
Next Rs. 25,000 20% 20%
Next Rs. 450,000 25% 25%
On remainder 30% 30%
Associate in a Global Business (offshore societe) (maximum rate) (Sec 47 ITA 95) 15% 15%

Going over the National Budget - November 2010 Back to Tax

PwC
Income Exemption Threshold / Personal Reliefs and Deductions
Personal Taxation

Income Exemption Threshold

Year of Assessment (YOA) 2012 2011 2010 2009/2010 2008/2009
Income Year Ended 31.12.11 31.12.10 (N1) 31.12.09 (N2) 30.06.09 30.06.08
Rs. Rs. Rs. Rs. Rs.
Category A (N3) 255,000 255,000 129,230 240,000 215,000
Category B (N4) 365,000 365,000 188,460 350,000 325,000
Category C (N5) 425,000 425,000 220,770 410,000 385,000
Category D (N6) 465,000 465,000 242,310 450,000 425,000
Category E (N7) 305,000 305,000 153,460 285,000 N/A
Category F (N8) 415,000 415,000 212,690 395,000 N/A

Note:

N1 The tax year has been aligned with the calendar year, covering January to December;

A six month tax year for July 2009 to December 2009 had been introduced to align the tax year with the calendar year. The income taxes due for this period were
N2
settled by 5 April 2010. An individual is entitled to only 7/13 of the Income Exemption Threshold;

N3 Category A refers to an individual who, in an income year , does not have any dependent;

N4 Category B refers to an individual who, in an income year, has one dependent only;

N5 Category C refers to an individual who, in an income year, has 2 dependents only;

N6 Category D refers to an individual who, in an income year, has 3 or more dependents;

N7 Category E refers to a retired person who, in an income year, does not have any dependent;

N8 Category F refers to a retired person who, in an income year, has one dependent only.

Going over the National Budget - November 2010 Back to Tax

PwC
Income Exemption Threshold / Personal Reliefs and Deductions (cont.)
Personal Reliefs and Deductions (before Y/A 2007/2008)

Year of Assessment (YOA) 2006/2007 2005/2006

INCOME YEAR ENDED 30 JUNE 2006 2005
Rs. Rs.
Basic personal deduction (N1) 85,000 80,000
Deduction for dependent spouse (N1) 85,000 65,000
Deduction for alimony & maintenance (N2) (N2)
Deduction for dependent children (N1)
- under 18 at any time in the income year (N3) (N3)
- over 18 & receiving full time instruction at an educational institution or serving under
articles to qualify in a trade or profession or being unemployed (N3) (N3)
- attending University/Polytechnic in Mauritius (N3) (N3)
- attending University/Polytechnic outside Mauritius (N3) (N3)
- attending courses at IVTB as a non sponsored student or at
State owned or approved technical school (N3) (N3)
Deduction for dependent handicapped child (over 18) 70,000 50,000
Deduction for other handicapped person 70,000 50,000

Note:
N1 An additional deduction of Rs 70,000 is available if a person, his spouse or dependent child is handicapped;

N2 Actual amount paid - No limit ;

- Infant: Rs. 30,000:

- Child attending pre-primary, primary, or secondary school Rs. 30,000 + school fees not exceeding Rs. 10,000
N3
- Child attending university in Mauritius Rs. 30,000 +school fees not exceeding Rs. 80,000
- Child attending university abroad Rs. 110,000

Going over the National Budget - November 2010 Back to Tax

PwC
Corporate Tax Rates and Tax Credits

Year of Assessment (YOA) 2012 2011 2010 2009/2010 2008/2009

Income Year (IY) Ended 30 June 2009 2008
Income Year (IY) Ended 31 December (N1) 2011 2010 2009
Corporate Tax Rates - Part II of First Schedule to the ITA 1995
(a) Tax incentive companies
1 Export enterprises
2 Strategic local enterprises
3 Modernisation & expansion enterprises
4 Industrial building enterprises
5 Pioneer status enterprises
6 Companies registered with SMIDO
7 Export services enterprises
8 Company operating an aerodrome
9 Hotel development company
Listed investment trust companies or approved investment All All All All
10 All
institutions companies companies companies companies
11 Authorised mutual funds companies
except except except except except
12 Trustees of unit trust schemes certain ICT certain ICT certain ICT certain ICT
certain ICT
13 Housing development companies companies companies companies companies companies
14 Polyclinic providing health services and and and and and
15 Manufacturing companies Freeport Freeport Freeport Freeport Freeport
companies companies companies companies companies
16 Category 1 global business company (N2)
are subject are subject are subject are subject are subject
17 Offshore societe opting to be taxed as company to tax at to tax at to tax at to tax at
18 Companies engaged in the management of venture capital funds & to tax at
15% 15% 15% 15% 15%
strategic local enterprises
19 Venture capital fund
20 Bus companies
21 Agro-based companies
22 Agricultural companies (other than sugarcane cultivation)
23 Leasing companies
24 A company deriving at least 75 per cent of its gross income from
construction activities in Mauritius
25 Companies authorized by the Financial Services Commission to
conduct specified business

Going over the National Budget - November 2010 Back to Tax

PwC
Corporate Tax Rates and Tax Credits (cont.)

Year of Assessment (YOA) 2012 2011 2010 2009/2010 2008/2009

Income Year (IY) Ended 30 June 2009 2008
Income Year (IY) Ended 31 December (N1) 2011 2010 2009
Corporate Tax Rates - Part II of First Schedule to the ITA 1995

(a) Tax incentive companies (cont.)

26 Fishing development companies
27 Leisure development companies
28 A company holding a regional development certificate
29 Companies engaged in the hotel industry
30 An ICT company
31 Companies operating duty free shops outside the port or airport
32 Companies providing secondary or tertiary, pre primary & primary
education
33 Companies holding a Regional Headquarters Certificate
34 Bank holding banking licence (N9) All All All All
All
35 Companies providing IVTB-approved training companies companies companies companies companies
36 Companies carrying on restaurant business except except except except except
37 Companies carrying on business as tour operator, boat house certain ICT certain ICT certain ICT certain ICT certain ICT
operator, big game fishing operator, scuba diving centre & companies companies companies companies companies
musical/other entertainment services provider and and and and and
Freeport Freeport Freeport Freeport Freeport
38 Companies set up to operate the Stock Exchange companies companies companies companies
companies
39 Companies providing central depository, clearing and settlement are subject are subject are subject are subject are subject
service to the Stock Exchange to tax at to tax at to tax at to tax at to tax at
40 Companies holding a management licence under the Financial 15% 15% 15% 15% 15%
Services Development Act
41 A company managing an equity fund
42 All companies providing financial services licensed under sec.14
of the financial services Development Act. 2001.
43 A guarantee fund established under sec.3.8 (a) of the Securities
(Central Depository, Clearing and Settlement) Act. (existing
companies)
44 Companies engaged in spinning, weaving & dyeing activities
(existing companies) (N10)

Going over the National Budget - November 2010 Back to Tax

PwC
Corporate Tax Rates and Tax Credits (cont.)

Year of Assessment (YOA) 2012 2011 2010 2009/2010 2008/2009

Income Year (IY) Ended 30 June 2009 2008
Income Year (IY) Ended 31 December (N1) 2011 2010 2009
Corporate Tax Rates - Part II of First Schedule to the ITA 1995

(b) Other companies

1 ICT companies engaged in BPO back office operations, call
5 5 5 5 5
centres or contact centres (up to 30.06.2012)
2 Companies operating in the Freeport Zone - applicable rate
0,15 0,15 0,15 0,15 0,15
depends on type of licence (exemption will apply up to YOA 2013)
3 Societes in real estate business 15 N/A N/A N/A N/A
4 Other companies including non-resident societes 15 15 15 15 15
Information and Communication Technology Companies
5 (certificate in force on or before 30.09.2006) – on services Exempt
provided to non-residents
Companies under the Investment Promotion (Regional
6
Headquarters Scheme) (certificate in force on or before Exempt for 10 years
30.09.2006)
7 Small and Medium Enterprise Companies Exempt 4 years

Corporate Tax Credits (N11)

Investment tax credit N/A N/A N/A (N4)
Modernisation and expansion N/A N/A N/A (N5)
Exports N/A N/A N/A (N6)
Limitation to tax credits N/A N/A N/A (N7)
Foreign tax credits (N8) (N8) (N8) (N8)

Alternative Minimum Tax (AMT)

Alternative Minimum Tax (AMT) (N3) (N3) (N3) (N3)

Going over the National Budget - November 2010 Back to Tax

PwC
Corporate Tax Rates and Tax Credits (cont.)

Annual
Capital Allowances – Year of Assessment 2012
Allowance
Plant & machinery 35%
Hotels 30%
Computer and electronic equipment 50%
Commercial premises including shops and shopping malls, offices, showrooms, restaurants and other entertainment places
5%
and clinics
Motor Vehicles (Maximum Rs3m of allowances per vehicle) 25%
Equipment and machinery costing less or equal to Rs 30,000 100%

Tax Deduction at Source Rate of tax Rate of tax Rate of tax Rate of tax Rate of tax
Year of Assessment 2012 2011 2010 2009/2010 2008/2009
Royalties 15% 15% 10% 10% 10%
Rent 5% 5% 5% 5% 5%
Payments to contractors and sub-contractors 0.75% 0.75% 0.75% 0.75% 0.75%
Payments to providers of services 3% 3% 3% 3% 3%

Note:
N1 The tax year which previously ran from 1 July to 30 June has been aligned with the calendar year.

N2 These companies are liable to tax at an effective rate not exceeding 3% on their foreign source income.

N3 The rate of Alternative Minimum Tax (AMT) is 7.5% as from YOA 2007/2008 (previously 5%).
30% of investment spread equally over 3 years from the year of investment limited to Rs 300,000 per annum. Special tax credit up to 60% of equity will be
N4
available over a period of 6 years in respect of investment in spinning, dyeing and weaving companies. Not available to tax incentive companies.
N5 10% of investment spread in any proportion over 3 years from the year of investment. Not available to tax incentive companies.

N6 Depending upon their volume of their export sales, companies may obtain a tax credit of up to 40%.

N7 Credits under Sections 69, 70 and 71 are limited in such manner as not to reduce the tax payable to less than 15% of chargeable income.

N8 The lesser of foreign tax paid and Mauritius tax attributable to foreign income.

N9 These companies are liable to tax at an effective rate not exceeding 3% (previously 5%) on their foreign source income.

N10 Special tax credit of 60% of equity of these companies available to the subscribing company.

N11 No tax credits and tax holidays will be available as from year of assessment 2007/08 except to existing beneficiaries.

Going over the National Budget - November 2010 Back to Tax

PwC
About PwC

Going over the National Budget – November 2010 Back to Contents

PwC 35
 About PwC

PwC firms provide industry-focused assurance, tax and advisory services to

enhance value for their clients. More than 161,000 people in 154 countries in firms
across the PwC network share their thinking, experience and solutions to develop
fresh perspectives and practical advice. See pwc.com for more information.

"PwC" is the brand under which member firms of PricewaterhouseCoopers

International Limited (PwCIL) operate and provide services. Together, these firms
form the PwC network. Each firm in the network is a separate legal entity and does
not act as agent off PwCIL
P CIL or any other
h memberb fi firm. PwCIL
P CIL does
d not provide
id any
services to clients. PwCIL is not responsible or liable for the acts or omissions of
any of its member firms nor can it control the exercise of their professional
judgment or bind them in any way.

Going over the National Budget – November 2010 Back to Contents

PwC 36
 Creating value through our services
Assurance

If information is important enough to be relied on, it’s important

enough for assurance!
PwC has the knowledge and experience necessary to help you with complex financial
accounting issues related to matters such as valuations, pensions and share plans,
listings, IFRS conversions, and corporate treasury,
We add value to the business of our clients by helping to improve transparency, trust
and consistency of business processes. Our strength and our in-depth industry specific
knowledge enable us to serve a wide spectrum of leading local, regional and
international companies.
companies

Our member firms audit many of the world’s best-known companies and thousands of
other organisations both large and small. Audit efficiency and a commitment to
financial reporting timeliness are the cornerstones of our assurance services.

• Tailored Services
• Computer-based audit approach
• Non-financial performance reporting
• I d t S
Industry Specialists
i li t

More information on
www.pwc.com/mu
p /

Going over the National Budget – November 2010 Back to Contents

PwC 37
 Creating value through our services
Tax (1 of 2)

Dealing with multi-layered tax issues requires multi-talented tax advisors

Advisory
• Advice on tax efficient international structure and policies
• Select the right jurisdiction
• Advice on cross border financing and treasury solutions
• Assist in registering as an employer with the Mauritius Revenue Authority and the
Ministry of Social Security
• Application for occupation permit for expatriates
• Assist in setting up offshore companies and securing relevant licences
• Advice
Ad i on Income Tax Treaties, i profit
fi repatriation
i i and d lloss utilization
ili i
• Structuring of tax efficient supply chain and shared services
• Optimising post deal tax structures
• Advice on tax efficient exit

Compliance
C li
• Preparation /review of tax computation
• Review of the financial statements (including disclosure notes) for any items which
may impact on the tax computation
• Re-computation of the supporting schedules to ensure accuracy, where relevant
• Review of key expense categories for unallowable deductions
• Use of our technical and sector expertise to assess any potential tax risks, including
latest tax cases and issues which may be of relevance
• Review of any current and future tax developments which may impact on the company's
More information on taxation affairs
www.pwc.com/mu
p / • Advice on the filing and payment due dates
• Assistance in filing the tax computation and return as appropriate
Going over the National Budget – November 2010 Back to Contents
PwC 38
 Creating value through our services
Tax (2 of 2)

Dealing with multi-layered tax issues requires multi-talented tax

advisors

Investigations
• Advise on issues raised by the MRA
• Compile, process and submit information to the MRA
• Assist in respect of site visits effected by officials of the MRA
• Prepare the grounds of appeal for representations to the Assessment Review
Committee
e dp
• Attend pro-forma
o o aa and d informal
o a meetings
ee gs
• Discuss and negotiate on your behalf with the MRA
• Prepare the grounds of objection to the assessment
• Assist in respect of site visits
• Assist lawyers in case preparation, including research on tax cases and technical
pp
support

VAT
• Review of VAT recording procedures and systems, including any recommendations;
• Provision of VAT advice on projects;
• Optimisation of the input VAT recovery process; and
• Performing VAT health checks to identify potential VAT exposures, including:
• Review of VAT returns;
• Detailed analysis of the VAT listings, including coding and classification;
More information on • Review of VAT control procedures, recording, and systems;
www.pwc.com/mu
p / • Review of VAT reconciliations and analysis of differences;
• Quantification of any potential VAT liability, including penalties and interest.

Going over the National Budget – November 2010 Back to Contents

PwC 39
 Creating value through our services
Consulting (1 of 2)

Helping business to work smarter and grow

PwC helps clients to design, manage and execute lasting change. Increasingly, value is
created across a complex network of partners, suppliers, customers, regulators and
stakeholders. Survival and success depends on collaboration amongst these.
Our Consultants bring together a full range of functional and industry skills to help
our clients in this environment:

Risk Advisory
Risk Advisory helps management, the board and third parties enhance and
strengthen their control and corporate assurance frameworks, addressing the
hazards and opportunities of risk across their organisations.

Enterprise
E t i RiRisk
k IInternal
t lAAudit
dit S
Services
i O
Operational
ti l Effectiveness
Eff ti
Management • Internal audit outsourcing
• Process Improvement –
• Internal audit co-sourcing
• Risk Function Effectiveness review of business
• Internal audit advisory
– Diagnostic review of processes and systems,
• Effectiveness reviews of
corporate / enterprise risk benchmarking them with
internal audit
frameworks leading practices and
• Methodology and tools
m0aking recommendations
• Design and implementation • Quality Review Audits
for improvement,
of an enterprise business • Training services
methodology training and
approach to risk • SAS 70 audits and other
application.
Compliance audits
More information on
www.pwc.com/mu
p /

Going over the National Budget – November 2010 Back to Contents

PwC 40
 Creating value through our services
Consulting (2 of 2)

Outsourcing
Our strength is in our network of talented people, vertical approach, knowledge,
and technology.
Outsourcing to PwC in Mauritius makes sense as, while we have performance
standards in line with the PwC Global standards, we are a lower cost region
compared to other outsourcing hubs in Europe and North America. Our staff are
perfectly bilingual in English and French, fibre optic connectivity to the rest of the
world is established, and we are situated in a favourable time zone.

People and Change

PwC's People and Change practice recognizes the important role people play in
creating value for businesses and works with companies that strive to make their
people a sustainable source of competitive advantage. We work closely with clients
to offer practical, multi-disciplinary approaches to create environments in which
their people can work most effectively.

More information on
www.pwc.com/mu
p /

Going over the National Budget – November 2010 Back to Contents

PwC 41
 Creating value through our services
Deals

Helping businesses succeed

PwC Deals Services provides tailor-made financial advisory services to a broad range of
clients whenever their capital structure is modified in someway or a share based
transaction is under consideration.

Our services combine advanced technical and technological resources with commercial
awareness based on our in-depth direct experience of industry.

Corporate Finance

We work k closely
l l with h clients
l and
d our services are d
designed
d to h
help
l them
h reach
h their
h
strategic goals by identifying opportunities arising and implementing investment decisions.

Transaction Support Services

We help p clients identifyy and focus attention on the factors in business that are critical to
their future success. We reconcile investors’ need for profit with the requirements of the
market for transparency.

Valuation services

Valuing all or part of a business requires the understanding and analysis of a variety of
complex factors.

Property Development
More information on
We advise clients on land realisation policy and project implementation based on our
www.pwc.com/mu
p /
experience of green field property development projects,
projects including Integrated Resorts
Schemes.
Going over the National Budget – November 2010 Back to Contents
PwC 42
 Creating value through our services
Deals

Business Recovery Services

Pre-Execution: Helping you to re-building value and Execution: Helping stakeholders

trust in distressed situations recover value

Independent
Financial Operational Corporate Corporate
business
restructuring restructuring simplification insolvency
review

Where businesses For companies, their Are you experiencing We assist Where a business is
are underperforming, lenders, shareholders one or more of the organisations that facing financial
in distress or in crisis, or other stakeholders potential issues with need to reduce distress or
we provide tailored in businesses facing your business? operating costs and insolvency, we may
business review financial under- achieve a simplified be able to help save
services either for performance or crisis, • Squeeze on more transparent it if action is taken
financial stakeholders we deliver working
g capital
p corporate structure early enough
enough.
or for the business restructuring by dissolving inactive Alternatively, we can
• Unexpected
itself. These services solutions and help companies that have help financial
collapse of
clarify the situation build a platform for fulfilled their stakeholders to
profitability
for both parties and recovery. economic purpose. recover value in an
allow clearer • Unsustainable insolvency.
evaluation
l ti off theth running costs
available options.
• Forecast covenant
breach of loan
More information on agreement
www pwc com/mu
www.pwc.com/mu

Going over the National Budget – November 2010 Back to Contents

PwC 43
www.pwc.com/mu
/

The comments and analysis contained in this publication are based on our understanding and
interpretation of the information available from the Budget Speech. You are therefore
cautioned to consult with your tax advisor or ourselves prior to any action being taken.

PricewaterhouseCoopers Ltd, its members, employees and agents do not accept or assume
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