Browsing: LRA

Lesotho has finalized a new tax treaty with Mauritius, alleviating fears in the southern African nation that multinational corporations were dodging taxes through shell companies.

The new agreement, which sets out the taxation rules for companies that run Lesotho businesses from Mauritius, came into effect replacing a 1997 treaty that, in recent years, the Lesotho authorities complained was unfair.

“The process for renegotiating the treaty was initiated by Lesotho in recognition that the old treaty was compromising Lesotho’s interests and because some of the key elements of a modern tax treaty were missing,” according to a brief provided to ICIJ by the Lesotho Revenue Authority.

Lesotho, a tiny, mountainous kingdom of 2 million people surrounded by South Africa, is rich in diamonds but has a stubbornly high rate of poverty. Almost half the population live below the poverty line, according to the World Bank.

In recent years, Lesotho’s economic performance …