**Mauritius Faces “Invisible Tax” from Banking Margins, Analysis Finds**
*Port Louis, Mauritius –* An analysis of the island’s financial sector published on the local news site News Moris warns that Mauritius is effectively paying a hidden economic tax of approximately 4.25 percent. The tax, the report argues, stems from a “malfunctioning monetary transmission mechanism” and what it describes as an “excessive banking margin.”
According to the analysis, the spread between the interest rates that banks charge borrowers and the rates they pay on deposits – the absolute interest‑rate spread – imposes a significant cost on both households and businesses. The report characterises this cost as an “invisible tax” that reduces disposable income and hampers investment.
The article does not provide detailed figures on the composition of the spread or the methodology used to calculate the 4.25 percent figure. It also does not name specific banks or quantify the impact on particular sectors of the economy.
No official comment has been obtained from the Bank of Mauritius, the Ministry of Finance, or representatives of the banking industry at the time of publication.
The analysis was first posted on News Moris (https://newsmoris.com/why-mauritius-banking-margin-creates-a-hidden-4-25-economic-tax/) and has been cited by local commentators as a call for a review of monetary policy transmission and banking practices in the country.
Article source: newsmoris.com | Image credit: Bloomberg.com
