Hereunder you will find a highlight of the main measures directly linked to the real sector proposed by the Finance Minister Pravind Jugnauth on the 29th of August 2016.
Do you think that these incentives will have a positive impact on the sector ? Please give your feedback by answering to the survey: Click here.
Exemptions on Registration Duty of 5% for Home Buyers
- Exemption for a Mauritian acquiring a newly built dwelling (on land which is not on “Pas Géométriques” or within an IRS, RES, PDS or IHS) during the period from 1 September 2016 to 30 June 2020.
- Exemption on the first Rs. 2 million of the value of bare residential land* not exceeding 20 perches for a first time buyer. The latter is defined as not owning any land on 29 July 2016 although he may have purchased one in the past.
- Exemption for a Mauritian borrower of less than Rs. 2 million for a secured housing loan.
- Exemption for a purchaser of a residential unit for less than Rs.6 million before 30 June 2020 (on land which is not on “Pas Géométriques” or within an IRS, RES, PDS or HIS) from a promoter of a Construction of Housing Estate Scheme** registered with the Mauritius Revenue Authority.
- Exemption for a promoter when acquiring land, (which is not on “Pas Géométriques” or within an IRS, RES, PDS or HIS) for a Construction of Housing Estate Scheme** registered with the Mauritius Revenue Authority where a residential unit is sold for less than Rs.6 million to a Mauritian before 30 June 2020.
Exemptions on Land Transfer Tax
- Exemption for an owner of land (which is not on Pas Géométriques or within an IRS, RES, PDS or HIS), when sold to a promoter for a Construction of Housing Estate Scheme** registered with the Mauritius Revenue Authority where a residential unit will be sold for less than Rs.6 million to a Mauritian before 30 June 2020.
- Exemption for a promoter when selling a residential unit for less than Rs.6 million on land (which is not on Pas Géométriques or within an IRS, RES, PDS or HIS) under a Construction of Housing Estate Scheme** registered with the Mauritius Revenue Authority to a Mauritian before 30 June 2020.
- Exemption for an employer providing free social housing to his employees on land not exceeding 7 perches.
Interest Relief on Home Loans
As from the income year 2016/17, a first-time home-owner is allowed to deduct from his taxable income, the interest paid by him on a secured housing loan irrespective of the date on which the loan was contracted. This deduction may now be claimed by a person or any spouse whose income does not exceed Rs. 4 million in an income year.
VAT refund upon Construction of a Residential Building
A Mauritian satisfying the following conditions may obtain a refund of VAT paid on the construction of a residential building by a building contractor or on the purchase of a new residence from a property developer:
- The cost of construction of the residential building or the purchase price of the new residence does not exceed Rs.4 million
- The construction is completed by 30 June 2020 and can be on an existing building
- The construction is not on land which is on Pas Géométriques or within an IRS, RES, PDS or IHS.
- The annual income of the applicant and his spouse does not exceed Rs. 2 million
- The VAT refund does not exceed Rs. 500,000
- The production of relevant receipts to the MRA
Business Facilitation: Simplification and shortening the delivery process of Building Land Use Permits
New measures have been proposed to reduce the process of approval and permit delivery:
The aim is to cut drastically the time taken for delivery of Building Land Use Permits (BLPs) and clearance for all construction-related projects. To this end:
- Requirement for approval by the Executive Committee of the Local Authority concerned when determining a BLP is now abolished
- The local authority will have only 8 working days to seek additional information from an applicant
- All applications for constructions with a floor area exceeding 150 square meters will be made online.
Foreign Acquisition: The Property Development Scheme (PDS)
The Property Development Scheme will be reviewed and PDS regulations will be amended to:
- No restriction on the maximum size of land (it was limited to 50 arpents)
- Removal of the requirement to sell at least 25% of residential units to Mauritians ; 100% of residential units can be sold to non-citizens.
- Individual plot size for the construction of a villa has been extended from half an arpent to a maximum of 1.25 arpent (5275m2).
Do you think that these incentives will have a positive impact on the sector ? Please give your feedback by answering to the survey: Click here.
Acquisition by Foreigners: Ability to purchase apartments and offices
To further open the economy, non-citizens registered with the Board of Investment (BOI), subject to security clearance, will be eligible to buy apartments and business spaces in buildings.
The Non-Citizens (Property Restriction) Act will be amended accordingly.
Incentives for Foreign Investment: Corporate Tax on Global Business Companies
New measures have been proposed to encourage foreign investments in the offshore sector.
The following companies licensed by the Financial Services Commission (FSC) and meeting the conditions with regards to minimum employment and substance will as from now benefit from tax holidays of 8 years:
- Global Headquarters Administration company (Tax holiday of 5 years)
- Treasury Management Centre Company
- Treasury Management Centre company
- Asset and Fund Manager with a minimum asset base of USD 100 million
- Foreign Ultra High Net Worth individuals investing a minimum of USD 25 million in Mauritius
- International law firms with global legal advisory services license
- Investment banks holding an Investment Banking and Corporate Advisory License
- Overseas Family Corporations
Note:
*Bare Residential Land - As opposed to Bare Residential land, Improved Land is defined as land that has certain utilities and services available to it. These would include electricity, telephone, water, sewer, etc.
** Housing Estate Scheme was introduced in 2012 and targets middle income households.
Do you think that these incentives will have a positive impact on the sector ? Please give your feedback by answering to our survey, Click Below:
