Senegal scraps ‘unbalanced' Mauritius treaty

Senegal has scrapped its tax treaty with Mauritius as debate rages over the island tax haven's impact on developing economies. The West African nation had previously threatened to cancel the double non-taxation treaty if certain conditions were not met. It claims the agreement, signed in 2004, had cost it $257m in lost tax revenue over 17 years. It marks the first time that Senegal has scrapped a bilateral tax treaty. ‘The problem with this tax treaty is that it was unbalanced,’ Magueye Boye, a Senegalese tax official told the International Consortium of Investigative Journalists (ICIJ). Mauritius' revenue authority and financial services commission did not respond to ICIJ's questions. In July 2019, ICIJ and journalists from 18 countries published Mauritius Leaks, which showed how multinational companies, often aided by major accounting and advisory firms like KPMG, used Mauritius to avoid paying taxes in some of the world's poorest countries. In the 2018 West Africa Leaks investigation, ICIJ revealed that a Canadian engineering giant avoided paying up to $8.9m in taxes to Senegal with the help of a shell company in Mauritius.