Mauritius Budget 2021-22 Highlights for Self-Employed and SMEs

This Mauritius Budget 2021-22 Highlights is a summary of the Budget Speech 2021-22 as regards measures announced for Self-Employed and SMEs.

Small and Medium Enterprises (SMEs)

The Government will:

• Finance the payment of the salary compensation of Rs 375 monthly for fiscal year 2021/22.
• Extend the exemption on trade fees not exceeding Rs 5,000 for an additional 5 years.
• Grant an amnesty on trade fees and related penalties and interests that were due before 1st January 2020.
• Extend the Tax Arrears Settlement Scheme for SMEs up to December 2021.
• Increase the total maximum grant across all schemes implemented by SME Mauritius Ltd from Rs 150,000 to Rs 200,000.

A 110 percent deduction will be allowed on the taxable income for the direct expenditure incurred on the purchase of products manufactured locally by SMEs.

The DBM Ltd will:

• Provide a rebate of up to 30 percent on the annual rental of industrial space to SMEs engaged in the manufacturing sector over the next 3 years
• Construct an SME Industrial Park of 5,000 square metres at Solferino, Plaine Magnien and Vuillemin
• Allocate 20 percent of spaces in these upcoming parks rent-free to start-ups for the first three years of operation.

SMEs will be eligible to the following loan schemes from the DBM:

• Rs 100,000 interest free loan for cashflow issues
• 0.5% COVID-19 Special Support Scheme of up to Rs 1 million
• loan facilities of up to Rs 5 million to retailers with turnover of up to Rs 250 million at a concessional rate of 3.5% per annum.

The EDB will set-up an online marketplace for start-ups to display their products and services.

Wage Assistance Scheme and the Self-Employed Assistance Scheme

The Government will extend the Wage Assistance Scheme and the Self-Employed Assistance Scheme for the tourism sector and SMEs. Furthermore, the Government will continue to pay the salary compensation of Rs 375 monthly for SMEs for the financial year 2021-22.

Contribution Sociale Généralisée (CSG)

Under the CSG, Self-Employed individuals, registered with the MRA and contributing to the CSG, will be eligible to benefits in case of injury at work.

Setting up of a Business Support Facility by the Economic Development Board (EDB)

The Business Support Facility will provide facilitation and advisory services and will dedicate an accounts manager to all businesses in Mauritius.

All incentives and schemes introduced by the Government will be made available through the EDB. As such, businesses will be required to register with the EDB to apply for the incentives and schemes.

Training

The Government intends to provide training and re-skilling to some 10,000 individuals over the next financial year.

• 6,000 unemployed individuals will undergo training and re-skilling under The National Training and Reskilling Scheme
• 750 apprentices will undergo training under a National Apprenticeship Programme. The apprentices will receive a monthly stipend of Rs 5,000 and a travelling allowance of Rs 1,000
• The Youth Employment Programme will be extended for another year for around 2,250 HSC, diploma and degree holders
• The SME Graduate Scheme will cater for around 1,000 graduates and diploma holders, and will also cover vocational training
• The Dual Training Programme will be renewed to cover 60% of academic fees of employees.

Women Entrepreneurship

Women entrepreneurs will be eligible to the following loan schemes from the DBM:

• Rs 100,000 interest free loan for cashflow issues
• 0.5% COVID-19 Special Support Scheme of up to Rs 1 million.

Women aged 30 and above will now be eligible under the Back to Work Programme instead of 35 years. Moreover, the monthly stipend will be increased to Rs 10,575.

Silence is Consent

The Government intends to apply the ‘silence is consent’ principle to licenses and permits.

Renewable Energy Schemes

The CEB will implement the various renewable energy schemes for households, businesses and SMEs.

Setting up of a Modernisation and Transformation Fund

The Rs 5 billion Fund will be managed by Industrial Financial Institution (IFI), a new institution taking over the activities of the ISP Ltd and SME Equity Fund.

Eligible sectors: manufacturing, agriculture and fisheries amongst others.

Projects eligible under this Fund will benefit from leasing facilities at a preferential rate of 2.5 percent per annum over an extended period of up to 9 years.

Leasing Equipment Modernisation Scheme (LEMS)

Reduction of the annual interest rate for the existing Leasing Equipment Modernisation Scheme (LEMS):

• LEMS I, from 3.9 percent to 2.9 percent for companies with turnover up to Rs 50 million;

• LEMS II, from 4.25 percent to 3.25 percent for companies with turnover between Rs 50 million and Rs 250 million; and

• LEMS III, from 4.75 percent to 3.75 percent for companies with turnover above Rs 250 million.

Credit Guarantee Scheme (CGS)

The Credit Guarantee Scheme (CGS) will be extended for SMEs to cover 5 percent of the default amount on leases contracted from private leasing companies.

The maximum investment through licensed crowd lending platforms by the Industrial Financial Institution will be increased to Rs 1 million per project.

A 200 percent deduction from taxable income will be allowed on the acquisition of specialised software and systems.

The Budget Speech 2021-22 can be downloaded here. The annex to the Budget can be accessed here.