Investment threshold reduced to US$ 375,000
Category Economy
In an effort to attract foreign direct investment and draw in international talent to bolster the island nation's economy, Mauritius' Minister of Finance, Planning and Development, Honourable Dr Payadachy recently made several announcements in the Budget for 2020-2021 impacting, amongst others, the Mauritius Permanent Residency programme.
Mauritius : Permanent Residence Permit
According to Regulation 13 of the Economic Development Board Regulations 2015, under the Immigration Act, the right to residency is granted to foreigners who invest in residential property under the Property Development Scheme (PDS). The PDS is the successor of the Integrated Resort Scheme (IRS) and Residential Estate Scheme (RES) - all residency schemes in Mauritius.
Previously a Permanent Residence Permit was granted to foreigners who invested over US$ 500,000 or its equivalent in approved real estate.
As per the latest Budget announcements this threshold has now been reduced to US$ 375,000. In order to attract more foreign investment Mauritius has also increased the duration of the Permanent Residence Permit from 10 to 20 years.
Key Highlights of the Mauritius Permanent Residency Permit
- Funds must be sent to a Mauritius registered and approved bank;
- The property must be a PDS approved property;
- The property may be rented out and generate income for the investor;
- Rental income and/or funds from the sale of the property can be transferred out of Mauritius without any restrictions;
- The investor can include his/her spouse and any dependent children up to the age of 24 (as well as elderly parents) ;
- There are attractive tax incentives including no capita gains tax or inheritance tax.
Taking a Step forward to compete with the European Golden Visa giants
Mauritius has been drawing in the affluent from all over Africa and beyond for decades. It boasts exceptional natural beauty, a lucrative tourism and leisure industry, tax incentives and a progressive approach to foreign investors. Wealthy retirees too have been investing in the Mauritian real estate market; residential and resorts, successfully for many years.
None the less, Mauritius isn't merely looking to attract foreign direct investment to offset its growing public sector debt as it wades through this crisis. It is also in dire need to attract actual foreign residents and international talent since it is facing an ageing population. To lure more talented professionals and investors to its shores, in addition to making the occupation and residency permits more accessible, Mauritian Permanent Residency permit holders can now also work and/or invest in Mauritius without requiring additional authorizations (as they had previously).
As the world continues to transition through this pandemic, we see a spike in the number of foreign investors who are now looking for actual, physical residency in new (safer) pastures.
In light of this, with the Mauritian Permanent Residence threshold lowered to a more competitive minimum of US$375,000, it is likely that people in Africa will re-consider Mauritius for their "Plan B".
South Africa in particular has an affinity for this paradisaical state, due to its geographic proximity, high standard of development and excellent quality of life. Whilst the residency programs or golden visas in Portugal and Greece have been in high demand by South Africans recently, this change in legislation could put the Mauritius residency scheme back in the running.
*Also applicable to IRS and RES developments
Author: Civitas Post