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Mauritius investor-friendly but no tax haven, says vice-premier news
20 January 2010

Denying that Mauritius is a tax haven for some Indian investors, the island nation's vice-prime minister Ramakrishna Sithanen said in New Delhi that he has not received any official complaints from India about companies routing investments through his country to take advantage of the double taxation avoidance agreement.

Without actually going on record, Indian authorities have long been accusing Mauritius of being a tax haven. Sithanen, who is also the country's finance and economic development minister, yesterday promised to cooperate with Indian authorities to check tax evasion in case of complaints, but added that his country would not welcome "fishing expeditions".

"Mauritius is not a tax haven ...we have not received a single complaint of round tripping from competent authorities (in India)," he said while talking to reporters on the sidelines of an investors' conference.

Round-tripping is a term used for routing domestic investments through other countries like Mauritius to take advantage of tax agreements to pay their tax rates, which are much lower than India's.

Sithanen said that although his country was not required to stop the reinvesting of Indian money in India under the tax treaty, Mauritius on its own has banned any round-tripping of investment of Indian money through shell companies in Mauritius. If any company is found reinvesting Indian money back in India, then its licence to operate from Mauritius is revoked. But so far not a single case has been found, he added.

Sithanen said that India and Mauritius have already formed a joint working group to look into ways of improving information flow between them. Mauritius is open to any suggestions to improve the financial reporting between the two nations, he added.

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Mauritius investor-friendly but no tax haven, says vice-premier