OECD’s Progress Report on Preferential Regimes declares Mauritius Partial Tax Exemption as not harmful
Last year, Organisation for Economic Co-operation and Development’s (OECD) released its report on Harmful Tax Practices. The report clearly indicated that Mauritius fulfils all the requirements of the BEPS Action 5, meaning it does not have any harmful practices in its tax regimes.
Indeed, in addition to fulfilling includes ‘a commitment to transparency through the compulsory spontaneous exchange of relevant information on taxpayer-specific rulings which, in the absence of such information exchange, could give rise to BEPS concerns’ (a minimum requirement of the BEPS Action 5), Mauritius kept its engagement in meeting and respecting international standards and best practices.
During its June 2019 meeting, the Forum on Harmful Tax Practices (FHTP) reviewed the substantial activities factor for no or only nominal tax jurisdictions as 22 jurisdictions amended their laws to address harmful tax practices. In order to ensure jurisdictions comply with the standards, the FHTP will start monitoring the effectiveness of their mechanisms on an annual basis, in order to ensure compliance with the standard in practice.
The conclusions of this report
On the 19th July 2018, the OECD released an update of its report on Peer Review Results, which clearly indicates that Mauritius fulfils all the requirements of the BEPS Action 5, meaning it does not have any harmful practices in its tax regimes.
This announcement further reaffirms the position of Mauritius as an International Financial Centre of repute and substance.
An insight on Base Erosion and Profit Shifting
Over 115 countries and jurisdictions, counting Mauritius, are co-operating to implement the BEPS measures and tackle BEPS.
OECD’s peer review forms part of the organisation’s Base Erosion and Profit Shifting (BEPS) Action 5. The Action 5 Report is one of the four minimum standards that all members of the Inclusive Framework on BEPS have committed to implement.
Since the start of the BEPS project, the FHTP has reviewed 287 regimes. The results of these reviews are as follows:
Please click here to find a full summary of the update.