This article is based on insights provided by Javed Niamut (Partner), Bowmans Mauritius, on the introduction of VAT on digital and electronic services by foreign suppliers under Mauritius’ amended VAT Act.
Mauritius to Impose 15% VAT. Mauritius is set to introduce a major shift in its indirect tax framework as it extends Value Added Tax (VAT) obligations to foreign suppliers of digital and electronic services beginning 1 January 2026.
The development follows amendments to the Value Added Tax Act 1995 under the Finance Act 2025, signalling a stronger push by the Mauritian government to align its tax system with global digital economy trends.
Under the new regime, all foreign digital service providers will be required to register for VAT and charge 15% VAT on services supplied to customers in Mauritius — regardless of turnover level.
No Turnover Threshold for VAT Registration
Unlike traditional VAT registration rules, the revised law removes any minimum turnover threshold for foreign suppliers providing digital and electronic services into Mauritius.
This means that any foreign business — no matter how small — supplying taxable digital services to customers in Mauritius must register for VAT and begin charging VAT at the standard rate of 15%.
However, the rule does not apply to:
- Foreign suppliers that already have a permanent establishment (PE) in Mauritius, or
- Transactions where VAT is already being accounted for under the reverse charge mechanism.
Wide List of Digital Services Now Taxable
The amended VAT framework significantly broadens the scope of taxable digital services. Covered services supplied by foreign providers through the internet or IT-based platforms include:
- Digital images and text such as e-books, photographs, and digitised documents
- Music, movies, television content, video games, and on-demand programmes
- Software, mobile applications, and software maintenance services
- Website hosting and web infrastructure services
- Online advertising services
- Online magazines and publications
- Remote maintenance of programmes and digital equipment
This effectively brings global tech firms, streaming companies, software providers, and online advertisers directly into Mauritius’ VAT net.
Appointment of Tax Representatives and Reporting Duties
Foreign suppliers whose annual taxable supplies exceed MUR 3 million (approximately USD 66,000) will be required to appoint an authorised tax representative in Mauritius.
The tax representative will be responsible for:
- Filing periodic VAT returns
- Submitting lists of taxable supplies
- Remitting collected VAT to the Mauritius Revenue Authority (MRA)
Even foreign suppliers below this threshold are still obligated to register and charge VAT, but may not be required to appoint a tax representative.
Why This Policy Shift Matters
Tax analysts view this change as a major realignment of Mauritius’ indirect tax system with global digital tax standards.
As cross-border digital trade continues to expand, governments across Africa and Europe are tightening rules to ensure that technology-driven revenues generated within their borders are properly taxed.
For foreign suppliers, the 2026 implementation date leaves limited time to:
- Review tax exposure
- Update invoicing and accounting systems
- Adjust pricing structures
- Ensure timely VAT registration and compliance
Failure to comply could expose businesses to penalties, back taxes, and enforcement actions.
Implications for Africa’s Digital Tax Landscape
Mauritius’ move mirrors similar developments across Africa, including:
- Nigeria’s Significant Economic Presence (SEP) rules for digital companies
- Kenya’s digital services tax
- South Africa’s VAT on electronic services
The trend confirms that African tax authorities are becoming increasingly assertive in taxing offshore digital income.
Disclaimer
The views expressed in the original analysis belong solely to the author and do not necessarily represent the views of Africa Tax Review.
