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The below summary was released today by Park Lane Properties.

The new budget makes several changes to Taxes, Residency by non-Citizens, Retired non-Citizens, Premier Visa, Smart Coty Scheme and Ground + 2 scheme, Acquisition of Property by non-Citizens:

06 June 2025

Budget 2025–2026 - Key Measures Impacting Real Estate and Investment in Mauritius

The 2025–2026 National Budget delivered last night by the Prime Minister and Minister of Finance, Dr. the Hon. Navinchandra Ramgoolam, has introduced a wide range of measures across fiscal, immigration, and property acquisition policies.

As always, our mission is to keep you informed of changes that may impact your investment journey in Mauritius, whether you are a Mauritian citizen or a foreign investor, buyer, seller, tenant, or landlord.

This year’s Budget was delivered in a context where bold action was expected.

It reveals a marked shift in the government's approach to the real estate sector.

Several real estate-related incentives have been withdrawn, and notable adjustments have been made to the framework governing property acquisition by non-citizens, alongside a new approach to residence and occupation permits. 

These include increased transaction taxes, elimination of key benefits under the Smart City Scheme, and stricter rules surrounding residency and occupation permits. These changes will inevitably impact both local and international stakeholders.

Mauritius has, over the years, built a strong reputation as a safe, stable, and investor-friendly jurisdiction, welcoming non-citizens and encouraging foreign direct investment through a competitive tax regime, including low corporate and personal taxes, and no capital gains, property, or wealth taxes.

These distinctive advantages have been essential to promoting the "Mauritius Advantage" in global markets.

With this new Budget, some of those long-standing advantages have been recalibrated.

The removal or amendment of some of these pillars raises questions about how existing and prospective investors will respond.

We understand that balancing national interests with investor confidence is delicate - but one must ask: are we unintentionally sending the wrong signal?

We remain hopeful that these changes will be fine-tuned to ensure continued attractiveness and long-term benefits.

Real estate has long been a pillar of Mauritius’ GDP and a major contributor to FDI.

We trust that the coming months will bring clarity and pragmatic adjustments where needed.

Please find below a structured summary of the most relevant Budget 2025–2026 announcements affecting both the Mauritian and foreign markets.

I. MEASURES IMPACTING THE LOCAL MARKET

1. Housing Relief Measures

The Housing Loan Relief Scheme has been renewed but will be phased out by 30 June 2027.

The VAT Refund Scheme on the construction of a residential building or the purchase of a residential unit from a developer will not be renewed after 30 June 2025.

The Home Ownership Scheme and the Home Loan Payment Scheme will also be discontinued.

2. Social and Affordable Housing

Increase in the income threshold for social housing eligibility from Rs 40,000 to Rs 48,000.

Rs 67.5m allocated to implement social housing projects for SRM beneficiaries.

Rs 40m for a National Syndic Scheme to improve maintenance in NHDC estates.

3. Tax Measures for Individuals and Companies

Introduction of a tiered tax system:

Fair Share Contribution of 15% on chargeable income (inclusive of dividends) for individuals with annual net income exceeding Rs 12 million.

For individuals earning above Rs 24 million annually, the tax rate increases to 20% on chargeable income.

Fair Share Contribution: 5% tax on chargeable income for companies earning over Rs 24 million.

Alternative Minimum Tax (AMT): 10% minimum tax on book profits for certain sectors including real estate.

Revision of personal income tax rates and bands:

First Rs 500,000: 0%

Next Rs 500,000: 10%

Remainder: 20%

4. Infrastructure & Investment

Rs 128 billion public investment planned in infrastructure over five years.

Investment in housing, road, water, and electricity projects

5. Ease of Doing Business and Regulatory Reform

Online permit applications: A new electronic platform will streamline the application and approval process for Occupation and Residence Permits.

Permit system reclassification: New categories introduced for professional, investor, and self-employed permits with revised criteria.

Electronic deed registration: Deeds and documents signed using secure digital signatures will now be accepted by the Registrar-General for registration and transcription.

Integrated permit system: Work and residence permits will be consolidated under a unified identification system.

Trust and property transfer clarifications: Clearer rules now apply for property transfers into trusts and mixed movable/immovable transfers.

II. MEASURES IMPACTING NON-CITIZENS / FOREIGN MARKET

1. Increase in Acquisition and Resale Costs for Non-Citizens

Registration Duty: Increased from 5% to 10% on properties purchased under IRS, RES, PDS, SCS, IHS and Ground +2 apartments.

Land Transfer Tax on Resale:

When a non-citizen sells a property originally acquired under these schemes or a Ground +2 apartment, the Land Transfer Tax will now be the higher of 10% of the sale value or 30% of the realised gain (i.e., the difference between the resale price and the original acquisition price).

Land Transfer Tax for Developers:

Property developers/promoters selling residential units under these schemes, including Ground +2 apartments, will also now be liable to pay Land Transfer Tax at 10% (up from 5%) at the time of registration of the deed of transfer.

Clarification: These new rates for both registration duty and land transfer tax will apply as from the date of publication of the Finance (Miscellaneous Provisions) Act 2025 in the Government Gazette.

Although the exact date has not yet been confirmed, it is expected shortly.

It is important to note that these rates will apply even if a reservation agreement was signed prior to the date of publication, as they will apply to all deeds registered after that point.

2. Smart City Scheme Incentives Removed

No fiscal incentives for Smart City certificates or registrations issued after 5 June 2025, except for public transport projects or those under the National Regeneration Programme.

Removed incentives include:

VAT exemption on buildings/infrastructure;

8-year income tax holidays on real estate income;

Customs and registration duty exemptions;

Land conversion and morcellement fee exemptions.

Existing projects with valid permits and construction started before 5 June 2025 retain certain VAT and tax benefits but lose customs and conversion exemptions.

Smart City projects will now be subject to a Morcellement Fee.

New sustainability features will be required as per EDB guidelines.

3. Revised Rules for Property Acquisition by Non-Citizens

The Non-Citizens (Property Restriction) Act will be amended to:

Prohibit the disposal or acquisition of an apartment in a building of at least 2 floors above ground floor which has been constructed on State Land or Pas Géométriques by a non-citizen or a person not resident in Mauritius.

Discontinue the scheme introduced in December 2023, which allows non-citizens with a Residence Permit to acquire one residential property outside of the schemes, including bare land, anywhere in Mauritius provided the property price exceeds USD 500,000.

4. Residence and Occupation Permit Reforms

Residency duration for retired non-citizens and Occupation Permits reduced from 10 to 5 years, renewable subject to compliance.

Minimum stay of 180 days/year required for retired permit holders.

Minimum transfer of USD 2,000/month or USD 24,000/year required for retired residence permit holders (this represents the new minimum investment criteria).

Prohibition on gainful employment or investment for retired non-citizens.

Age cap of 24 years for dependent children.

Occupation Permits for Young Professionals reduced to 2 years, with progression to professional category subject to eligibility.

COVID-era permit provisions repealed - including, we believe, the Premium Visa, although official clarification on this point is still awaited.

CONCLUSION

This Budget introduces a wave of fiscal and policy changes that will affect a broad spectrum of stakeholders, from Mauritian families and entrepreneurs to international investors and retirees.

While some initiatives aim to promote fairness and reinforce public finances, others may introduce a degree of uncertainty that could momentarily temper momentum in the real estate sector and influence investor sentiment.

Time and again, our real estate sector has demonstrated remarkable resilience, consistently appreciating in value even amid global uncertainty.

Mauritius continues to offer a truly compelling proposition: a safe and secure lifestyle, excellent infrastructure, political and economic stability, and a naturally stunning environment.

We firmly believe that our country has much to offer, and will continue to attract those seeking quality living and investment opportunities in one of the most exceptional destinations in the world.

We will continue to advocate for a balanced approach that preserves and enhances Mauritius’ appeal as a world-class destination for living, working, and investing.

Warm regards,

Philippe de Beer

CEO & Founder

Park Lane Properties (Mauritius)

Note: The above measures are subject to amendment and will only be effective when promulgated in the Finance Act in the coming weeks.

The content of this summary is intended to provide a general guide and should not be regarded as a basis for ascertaining liability to tax or determining investment strategy in specific circumstances. In such cases specialist advice should be taken