On 17 January 2022, the Financial Services Commission (FSC) issued a circular to explain their new policy stand on the application of the “core income-generating activities” requirement.
FSC Act
Under section 71(3)(a)(i) of the Financial Services Act, holders of a global business licence shall at all times carry out its core income-generating activities in or from Mauritius. This requirement is also subject to the requirements laid down in the Income Tax Act.
Income Tax Act
The income tax act requires entities benefiting from a preferential tax advantage to satisfy conditions relating to the substance of their activities. The Income Tax Regulations 1996 provides that one of the eligibility requirements is that the company carries out its core income-generating activities in Mauritius.
Policy Stance
Accordingly, the FSC requires that only holders of or applicants for a Global Business Licence that benefit or would like to benefit from a preferential tax advantage, demonstrate that at all times their core income-generating activities are or would be carried out in or from Mauritius.
Applicability
The FSC has stated that this new policy stand shall be effective from 01 January 2022.
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