By Olivier RogezPosted on 24-07-2019Modified on 24-07-2019 at 20:45

According to the International Consortium of Investigative Journalists, Mauritius would help drain the finances of their African partners, by depriving them of part of their tax revenues. "We believe that in the absence of a comprehensive study, these accusations are not acceptable," RFI Sudhir Sesungkur, Minister of Financial Services and Good Governance, told RFI. Interview.

The International Consortium of Investigative Journalists relies on leaks from a tax optimization expert law firm . The advantageous tax system in Mauritius combined with the double taxation agreements with some fifteen African countries is pushing multinational companies to domiciliate on the island, part of their business to escape the tax. Some countries like Senegal, considering these agreements unbalanced, want to renegotiate them.

RFI: According to the revelations of the International Consortium of Investigative Journalists, Mauritius would help drain the finances of their African partners. What do you think ?

Sudhir Sesungkur: All this is a matter of perception, a UN report in 2019, clearly shows that the financial center of Mauritius has contributed enormously in terms of foreign capital inflow. We believe that in the absence of a comprehensive study, these charges are not acceptable. Recently, the OECD has done a lot of work to evaluate our tax system and our tax system, to conclude that they comply with international regulations. These accusations that we are made are frivolous accusations that are not based on an in-depth analysis.

You say that the Mauritian financial center brings foreign capital to Africa, yet an IMF report dating back to 2018 asserts that your country's favorable tax regime has not resulted in any significant increase in foreign investment for African countries.

We believe that double taxation agreements provide certainty for investors. And this certainty is an important thing. Investors are more likely to come when they are certain of the tax base. If you tell me that the IMF does not think it's important to have that certainty, I would not comment on that position.

Some of your partners, like Senegal, criticize agreements they have signed, saying that they are not in favor of them and that they should be renegotiated.

But all non-double taxation agreements provide for renegotiation clauses, if ever one of the partners believes that they need to be renegotiated and rebalanced. This is perfectly normal ! And besides, we are renegotiating with Senegal. We ourselves have done it in 60% of cases, and we are often the ones who take the lead. It's a dynamic exercise.

If you renegotiated your agreements in 60%, is there a problem?

I tell you it's a dynamic process. When you sign an agreement, ten years later you can not predict what the new business environment is, so when the deal changes, you have to adapt.

The European Union has placed Mauritius on the gray list of tax havens, and believes that your tax rules are too aggressive and destabilizing. What do you think ?

No, we have been checked and evaluated and Mauritius is not a tax haven. It is not correct to say that. The European Union being an important partner in our commercial relationship, finds that there are some additional improvements to be made. And we did it because we want to play the game and comply with international regulations. But we think that the body to be trusted is the OECD, because they are the experts in the field. But at the request of the European Union, we have corrected some points, it is a matter of weeks or months and we will be fully in compliance with the European regulations.

A World Bank report of March 2018 highlights the prosperity of Mauritius, but highlights the fact that this prosperity is not shared by all Mauritians and that inequality is increasing. Is not it disturbing?

► To read also: "Mauritius Leaks": revelations about Mauritius, "treasure island"

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