As the tax accounting year is approaching, people are getting more and more apprehensive. This year a new system is being introduced. If quite a good number of income tax payers will be waived from the list, those who’d remain may have another sword of Damocles on their head. They’ll be held accountable for what wasn’t previously.
Those who’ve been pooling their savings over the years to ensure better comfort in later days and to acquire and build residential premises for their own and their families’ well being will have to declare these and “give” a percentage to government. As if you have no right to own what you own.
This year will witness the introduction of the NRPT, the National Residential Property Tax – some have nicknamed it Navin Ramgoolam Property Tax after the current Prime Minister’s name, as it’s his government that’s come up with this new concept in the country. The section of the income tax return form relating to NRPT will require taxpayers whose annual revenue exceeds Rs 385 000 to declare the extent of property they own: housing, apartments or bungalows. For personal residential purposes the amount of tax payable is Rs 10 per square meter of land area. For apartments the rate will be Rs 30 per square meter of floor area of the building. Such tax will, however, not be applicable to residential land where there’s no construction.
Political and social factions are organizing resistance in an effort to counteract the implementation of this measure. The trade union organizations have also joined hands to call for civil disobedience. They argue the NRPT is anti-constitutional in the sense that it goes against the constitutional right of private land ownership.
“Government cannot at the stroke of a pen declare a private property a national property,” says one of the spokesmen of the group. “The new measure seems to make of the owner a tenant in that he has to pay for owning and occupying a residential area, which he has acquired at the sweat of several years or even a lifetime of sacrifice after securing endless loans and acquitting themselves of the registration fees. They are already overburdened with repayments.”
Since the announcement of this measure in the last budget presentation, the resistance group entered a case in court and is awaiting judgment. Up to now they say the respondent (the government) hasn’t filed its defense. Until and unless the case is heard and determined the group believes it’s unfair to go ahead with the NRPT. As the forms are already on their way to the taxpayers, the group requests all concerned not to fill in the section relating to NRPT mentioning in the relevant space “awaiting court judgment”.
Bank interest is another headache this year. It will be chargeable. Banks have already sent out or are currently sending interest statements to individual account holders. Tax on interest will be charged at 15% on the amount accrued during the year. For bank deposits exceeding Rs 2 M there’ll be a deduction at source, meaning the banks will automatically deduct the amount payable and credit it to the Mauritius Revenue Authority (MRA), the authority responsible for the collection and management of taxes.
Taxpayers will not be allowed to claim any deductions as before except for their dependents. A dependent is clearly defined as spouse, or child under 18 years of age or child over 18 but receiving university education or undergoing training or unemployed or unemployable due to certain handicaps. Previously you could deduct for any other dependent, for interests payable on loans, for premiums on personal life policies and for expenses in relation to self education. These have been chopped from the list; taxpayers will be classified into four categories of income exemption thresholds, A, B, C and D.
Those with total yearly income of Rs 215 000 and without any dependent will fall in A. Category B will include those with yearly income of Rs 325 000 and having one dependent provided the exempt income of the latter does not exceed Rs 110 000. C will group those earning Rs 385 000 yearly and having two dependents at charge provided the exempt income of the second dependent is less than Rs 60 000. While D will take on board those whose yearly income is Rs 425 000 and have three dependents but the exempt income of the third dependent should not be more than Rs 40 000.
The latest date of filing income tax returns is 30 September.
Note: 1 USD = Rs 31; 1 GBP= Rs 62; 1 EURO= Rs 42. (approx)