Worried about the possibility of Mauritius-based fi moving out to other countries like Singapore, the Malaysian Prime Minister has written to India to look into the issue. He has even suggested some changes in the general anti-avoidance rules that will come into effect next year. Idina searched Narae joins us with exclusive details on this particular story. Today's noir discusses whether Mauritius wants this and if the finance ministry is willing to consider it. At this stage, the finance ministry is not ready to give any assurances to the Mauritius government. They state that the provisions under the general anti-avoidance rules will override the dtw between India and Mauritius. However, they also mention that the rulemaking committee is the final authority to decide on the provisions. Sources indicate that there will be an elaborate definition of the substantial commercial interest. This definition will clarify whether tax residency certificates will be sufficient to escape tax in India. Additionally, there will be a threshold and other clarifications to address concerns regarding circular 789, which provides for no taxation in India if the tax residency certificate is provided by the Mauritian government to an fi. It is worth remembering that the Mauritius Prime Minister had expressed concern to the PMO that fi based out of Mauritius might migrate to other tax regimes, especially Singapore, since the zero taxation provision will not be applicable once Ansgar comes into effect.
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