Mauritius is one of the best places to do business in Africa and has been for a long time. Before the World Bank discontinued its “Ease of Doing Business” report, Mauritius was ranked 1st in Africa and 13th globally. Although the World Bank said it discontinued the Ease of Doing Business Report “after data irregularities on Doing Business 2018 and 2020 were reported internally in June 2020,” Mauritius has consistently been one of the top ranked nations, which in a way still shows the country was leading the continent on this front.
Centurion Lawyers and Business Advisors says “Mauritius remains among the Sub-Saharan Africa region’s most business-friendly countries, with solid economic policies and prudent banking practices, suitable for both domestic and foreign entrepreneurs and investors.” Mauritius also has one of the world’s most generous tax regimes. Personal and corporate tax are harmonized at a low 15% and dividends are tax-free. Mauritius also has non-double taxation agreements with 33 countries. Mauritius has now moved to extend its awesome tax policies to catalyze the adoption of electric mobility. From the 1st of July 2022, all hybrid and electric vehicles are now duty-free in Mauritius. This was announced earlier this year by Finance Minister Renganaden Padayachy in his 2022-23 Budget Speech.
The Mauritian government also introduced a rebate on the excise duty scheme of 10% for the purchase of electric vehicles by individuals up to a maximum of Rs 200,000 ($4,500). These incentives were introduced under the “Accelerating The Land Transport Electric Vehicles Transition” program where the government wants to further reduce its dependence on import of petroleum products, decarbonize the land transport system, and accelerate the EV transition. This makes so much sense for an island nation that depends on imports for fueling ICE vehicles.
The government is also moving to increase the penetration of locally generated renewable energy. They have a target of 60% energy from renewable sources by 2030. The power of incentives for the electric mobility sector is well known. Norway led the way over the past decade and now the share of electric vehicles in Norway is consistently hovering above 85%. China is another example where incentives really sparked the EV revolution. In Africa, Rwanda introduced a wide range of awesome incentives last year.
It’s really good to see another African country introducing some incentives for electric vehicles. Mauritius is a member of the Southern African Development Community (SADC) where South Africa, the continent’s largest automobile market, is also a member. We hope South Africa can get inspired by its fellow SADC state. In South Africa, EVs still attract higher import duties and taxes than internal combustion engine vehicles, which is really strange in 2022.
Most of the electric vehicles still have higher prices than their equivalent ICE vehicles and hence will cost much more when they land in Africa after shipping and import duties. Removing import duties for EVs will be one of the quickest ways to ensure consumers get access to more affordable EVs. Mauritius and Rwanda are leading the way in Africa. I hope South Africa, Kenya, Zimbabwe, and the rest of the countries on the African continent follow soon.
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