Yen Statements That Don't Survive A Fact-Check

1. Postponing BRP eligibility to 65 years was an anomaly that had to be removed (2025). BRP is an important component of our welfare state which keeps 1/3 of Mauritians out of poverty. If you postpone the age people start getting it you will create a lot of poverty and hardship just like the 2012 HBS told us voodoo economics had and slow down the economy because a lot of these monies are used to buy essential things not villas 99% Mauritians cannot afford.

2. It's shocking to see that we spend 90 billion rupees in the budget on social security while spending only 20 billions on education and health each and about 10 billions in other sectors (2025). Our economy at the end of 2024 was 2.3X times smaller than what Sithanen said it would grow to when he introduced his ruinous 15% flat tax in 2006 so it's not a big surprise that several of our budget items are a lot smaller than they ought to have been. Granted the BRP increased a bit too quickly during the last 10 years but if we spent the same share of GDP as the Seychelles then we should have spent 3.3X on education what we're planning to spend during FY25/26 (66 billions instead of 20 billions) and 4.6X on health or 92 billions.

3. With an ageing population and fewer young people to finance the system we will have to raise VAT to 30% and income tax to 50% or 60% (2025). If the BRP appears to be unsustainable it's because we never got the expected 8% growth rates from the 15% flat tax, actually clocking an average growth rate of only 3.3% between 2006 and 2024. This has caused a GDP shortfall of more than 6 trillion rupees at the end of 2024 and a revenue shortfall, by conservative standards, of 1.235 trillion rupees in the government till. The latter would have fuelled a mighty sovereign wealth fund which would have helped in making the system sustainable for the long term.

Plus we don't have to raise VAT, top income tax rates can and should go all the way to 95% for monster dividends and we can impose a wealth tax to make those who suffered the most during the last twenty years of voodoo economics catch up.

4. Today we have three working people for each retiree, in 10 years it will be 2.5 and in forty perhaps 1. This will require younger people to pay three times more taxes (2025). It depends on how you govern the country. If, among other things, you have a sustainable tax structure, competitive energy prices and good overall governance you will not have to increase taxes threefold.

5. A BRP of Rs5,500 today would have been reasonable and affordable (2025). Please go to the groceries more often.

6. If the BRP was Rs5,500 people would have been more willing to wait an extra five years to start getting it (2025). Life has become so expensive during the last 20 years for the many that a Rs5,500 BRP would have thrown thousands more into poverty. Delaying it for five more years will be very dramatic.

7. Pushing BRP eligibility to 65 is not only a good thing but we don't have any choice. We'll save 3 billions the first year, then 9 then 15. (2025). Of course we have a choice, we can as starters do the most normal thing of keeping the fair-share contribution forever, freeze construction of new roads, impose a wealth tax and cut wastage.

8. Mauritius must remain a reasonable tax jurisdiction, not like countries at 50%-60%. We used to have a 15% flat tax and this helped us (2025). A reasonable tax structure is one with high top tax rates. The 15% flat tax has deep-fried our economy.

9. If we don't do the BRP reform we will not even be able to import rice or flour. We have to do this to make our economy healthy again (2025). We've been importing a lot of nonsense over the past 20 years and this has nothing to do with the BRP. Postponing BRP eligibility will make our economy anything but healthy. Here's something that will. Renegotiating the three abusive IPP contracts that expired during the past 9 months on more reasonable terms.

10. The BRP bomb has exploded (2025). Nope. You seem not to be able to tell the difference between a small firecracker and an atom bomb.

11. We have to be wary of the tax hikes. We shouldn't scare off taxpayers (2025). Mauritius has been suffering from a very serious brain drain problem during the last two decades, the second-worst in Africa according to a 2013 report, which was a period of an unfair tax structure. Clearly the 15% flat tax was no incentive for the highly-educated locals to stay back.