Mauritius is one of a handful of tax havens used by Indian investors to protect their assets from heavy taxation. However, the Indian government just approved the general anti-avoidance rule (GARR) which would override double taxation treaties Mauritius now has in place with India. Certain types of foreign investment would be taxed by the Indian government even if the investor is based and incorporated in Mauritius. Not only will that have a negative effect on the Indian economy, it's expected to reduce the total amount of new foreign investment headed for Mauritius.
As that investment is reduced it will have an obvious impact on the Mauritian tourism industry. But it's quite likely the impact will be more positive than negative. Right now much of the foreign investment that comes to Mauritius by way of India doesn't stay in the country. But in order to avoid double taxation it's possible that Indian investors will leave their money in Mauritius and use it to invest in the various components of the island's economy. When all is said and done the local investment, combined with foreign investors staying put, could mean new resorts, new golf courses, upgraded infrastructure, and so on.
Mauritius holidays could very well become even more inviting should all of this come to fruition. More investment funds would mean many of the islands resorts would be looking at expanding and upgrading. Mauritius might also see an increase in tourism\-related businesses such as boat charters, offshore fishing, new bars and restaurants, shopping centres, and so on. It is a scenario that could be just what Mauritius needs to keep investment funds freely flowing on the island.
The immediate impact of GAAR is largely unknown and the effects probably won't be felt for at least the next 6 to 10 months. In the meantime the spectacular white sand beaches and blue Indian Ocean water continue to be an inviting beacon to Westerners looking for a sun and surf holiday; and with the peak holiday season winding down, the late spring and summer months make the perfect time for those travellers that want to get reduced prices on all-inclusive holiday packages. For all intents and purposes, Mauritius is open for business and ready to play.
Your luxury Mauritius holidays begin when you contact Mauritius holidays direct, the UK-based luxury holiday company bringing you great packages in Mauritius and the surrounding Indian Ocean region.
